Federal Register, Volume 81 Issue 171 (Friday, September 2, 2016)


[Federal Register Volume 81, Number 171 (Friday, September 2, 2016)]
[Rules and Regulations]
[Pages 61067-61098]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-21125]



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Vol. 81

Friday,

No. 171

September 2, 2016

Part VI





Department of Defense





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Office of the Secretary





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32 CFR Part 199





TRICARE; Mental Health and Substance Use Disorder Treatment; Final Rule

Federal Register / Vol. 81 , No. 171 / Friday, September 2, 2016 /
Rules and Regulations

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DEPARTMENT OF DEFENSE

Office of the Secretary

32 CFR Part 199

[DOD-2015-HA-0109]
RIN 0720-AB65


TRICARE; Mental Health and Substance Use Disorder Treatment

AGENCY: Office of the Secretary, Department of Defense (DoD).

ACTION: Final rule.

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SUMMARY: This final rule modifies the TRICARE regulation to reduce
administrative barriers to access to mental health benefit coverage and
to improve access to substance use disorder (SUD) treatment for TRICARE
beneficiaries, consistent with earlier Department of Defense and
Institute of Medicine recommendations, current standards of practice in
mental health and addiction medicine, and governing laws. This rule
seeks to eliminate unnecessary quantitative and non-quantitative
treatment limitations on SUD and mental health benefit coverage and
align beneficiary cost-sharing for mental health and SUD benefits with
those applicable to medical/surgical benefits, expand covered mental
health and SUD treatment under TRICARE to include coverage of intensive
outpatient programs and treatment of opioid use disorder and to
streamline the requirements for mental health and SUD institutional
providers to become TRICARE authorized providers, and to develop
TRICARE reimbursement methodologies for newly recognized mental health
and SUD intensive outpatient programs and opioid treatment programs.

DATES: This rule is effective October 3, 2016.

FOR FURTHER INFORMATION CONTACT: Dr. John Davison, Defense Health
Agency, Clinical Support Division, Condition-Based Specialty Care
Section, 703-681-8746.

SUPPLEMENTARY INFORMATION:

I. Executive Summary

A. Purpose of the Final Rule

1. The Need for the Regulatory Action
This final rule updates TRICARE mental health and substance use
disorder benefits, consistent with earlier Department of Defense and
Institute of Medicine recommendations, current standards of practice in
mental health and addiction medicine, and our governing laws. The
Department of Defense remains intently focused on supporting the mental
health of our service members and their families, as this continues to
be a top priority. The Department is also working to further de-
stigmatize mental health treatment and expand the ways by which our
beneficiaries can access authorized mental health services. This
regulatory action eliminates unnecessary requirements that may be
viewed as barriers to medically necessary and appropriate mental health
services.
This rule has four main objectives: (a) To eliminate unnecessary
quantitative and non-quantitative treatment limitations on SUD and
mental health benefit coverage and align beneficiary cost-sharing for
mental health and SUD benefits with those applicable to medical/
surgical benefits; (b) to expand covered mental health and SUD
treatment under TRICARE, to include coverage of intensive outpatient
programs and treatment of opioid use disorder; (c) to streamline the
requirements for mental health and SUD institutional providers to
become TRICARE authorized providers; and (d) to develop TRICARE
reimbursement methodologies for newly recognized mental health and SUD
intensive outpatient programs and opioid treatment programs.
(a) Eliminating Unnecessary Quantitative and Non-Quantitative Treatment
Limitations on SUD and Mental Health Benefit Coverage and Aligning
Beneficiary Cost-Sharing for Mental Health and SUD Benefits With Those
Applicable to Medical/Surgical Benefits
The requirements of the Mental Health Parity Act (MHPA) of 1996 and
the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction
Equity Act (MHPAEA) of 2008, as well as the plan benefit provisions
contained in the Patient Protection and Affordable Care Act (PPACA) do
not apply to the TRICARE program. The provisions of MHPAEA and PPACA
served as models for TRICARE in proposing changes to existing benefit
coverage. These changes are intended to reduce administrative barriers
to treatment and increase access to medially or psychologically
necessary mental health care consistent with TRICARE statutory
authority and program design.
Section 703 of the National Defense Authorization Act (NDAA)
National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2015,
signed into law December 19, 2014, amended section 1079 of title 10 of
the U.S.C. to remove prior existing statutory limits and requirements
on TRICARE coverage of inpatient mental health services. This rule is
necessary to conform the regulation to provisions in the enacted law.
Specifically, TRICARE coverage is no longer subject to an annual limit
on stays in inpatient mental health facilities of 30 days for adults
and 45 days for children. In addition, TRICARE coverage is no longer
subject to a 150-day annual limit for stays at Residential Treatment
Centers (RTCs) for eligible beneficiaries.
In addition to the elimination of these statutory inpatient day
limits and corresponding waiver provisions, the rule will also
eliminate other unnecessary quantitative and non-quantitative treatment
limitations, consistent with principles of mental health parity and our
governing laws.
Additionally, this rulemaking will remove the categorical exclusion
on treatment of gender dysphoria. This change will permit coverage of
all non-surgical medically necessary and appropriate care in the
treatment of gender dysphoria, consistent with the program requirements
applicable for treatment of all mental or physical illnesses. Surgical
care remains prohibited by statute at 10 U.S.C. 1079(a)(11), as
discussed further below.
Finally, following the recent repeal (section 703 of the NDAA for
FY 15) of the statutory authority (previously codified at 10 U.S.C.
1079(i)(2)) for separate beneficiary financial liability for mental
health benefits, the rule revises the cost-sharing requirements for
mental health and SUD benefits to be consistent with those that are
applicable to TRICARE medical and surgical benefits.
(b) Expanding Coverage To Include Mental Health and SUD Intensive
Outpatient Programs and Treatment of Opioid Use Disorder
Previously, TRICARE benefits did not fully reflect the full range
of contemporary SUD treatment approaches (i.e., outpatient counseling
and intensive outpatient program (IOP)) that are now endorsed by the
American Society of Addiction Medicine (ASAM), the Department of Health
and Human Services (DHHS) Substance Abuse and Mental Health Services
Administration (SAMHSA), and the VA/DoD Clinical Practice Guidelines
(CPGs) for SUDs.
An amendment to the regulation was necessary to authorize TRICARE
benefit coverage of medically and psychologically necessary services
and supplies which represent appropriate medical care and that are
generally accepted by qualified professionals to be reasonable and
adequate for the diagnosis and treatment of mental disorders. TRICARE
coverage of

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medication assisted treatment (MAT) for opioid use disorder, extended
through regulatory revisions, as published in the Federal Register on
October 22, 2013 (78 FR 62427), was previously limited to MAT provided
by a TRICARE authorized SUDRF. This revision of the TRICARE SUD
treatment benefit allows office-based opioid treatment (OBOT) by
individual TRICARE-authorized physicians and adds coverage of qualified
opioid treatment programs (OTPs) as TRICARE authorized institutional
providers of SUD treatment for opioid use disorder.
(c) Streamlining Requirements for Institutional Mental Health and SUD
Providers To Become TRICARE Authorized Providers
While TRICARE's comprehensive certification standards were once
considered necessary to ensure quality and safety, these comprehensive
certification requirements proved to be overly restrictive and at times
inconsistent with current industry-based institutional provider
standards and organization. There are currently several geographic
areas that are inadequately served because providers in those regions
did not meet TRICARE certification requirements, though they may have
met the industry standard. This final rule will streamline TRICARE
regulations to be consistent with industry standards for authorization
of qualified institutional providers of mental health and SUD
treatment. It is anticipated that these revisions will result in an
increase in the number and geographic coverage areas of participating
institutional providers of mental health and SUD treatment for TRICARE
beneficiaries.
(d) TRICARE Reimbursement Methodologies for Newly Recognized Mental
Health and SUD Intensive Outpatient Programs and Opioid Treatment
Programs
Along with recognition of several new categories of TRICARE
authorized providers, this rule establishes reimbursement methodologies
for these providers. Specifically, new reimbursement methodologies are
instituted for IOPs for mental health and SUD treatment as well as
OTPs, as these providers had not previously been recognized by TRICARE
and thus appropriate reimbursement methodologies must be established.
Existing reimbursement methodologies for SUDRFs, RTCs, and PHPs will
continue to apply.
2. Legal Authority for the Regulatory Action
The legal authority for this final rule is 10 U.S.C., section 1073,
which authorizes the Secretary of Defense to make decisions concerning
TRICARE and to administer the medical and dental benefits provided in
title 10 U.S.C., chapter 55. The Department is authorized to provide
medically necessary and appropriate medical care for mental and
physical illnesses, injuries and bodily malfunctions, including
hospitalization, outpatient care, drugs, and treatment of mental health
conditions under 10 U.S.C. 1077(a)(1) through (3) and (5). Although
section 1077 identifies the types of health care to be provided in
military treatment facilities (MTFs) to those authorized such care
under section 1076, these same types of health care (with certain
specified exceptions) are authorized for coverage within the civilian
health care sector for ADFMs under section 1079 and for retirees and
their dependents under section 1086. In general, the scope of TRICARE
benefits covered within the civilian health care sector and the TRICARE
authorized providers of those benefits are found at 32 CFR 199.4 and
199.6, respectively.
TRICARE beneficiary cost-sharing is governed by statute and
regulation based upon both the beneficiary category and TRICARE option
being utilized. With the recent repeal of the statutory authority
(previously codified at 10 U.S.C. 1079(i)(2)) for separate beneficiary
financial liability for mental health benefits, this final rule revises
the cost-sharing requirements for mental health and SUD benefits to be
consistent with those that are applicable to TRICARE medical and
surgical benefits.
With respect to institutional provider reimbursement, pursuant to
10 U.S.C. 1079(i)(2), the Secretary is required to publish regulations
establishing the amount to be paid to any provider of services,
including hospitals, comprehensive outpatient rehabilitation
facilities, and any other institutional facility providing services for
which payment may be made. The amount of such payments shall be
determined, to the extent practicable, in accordance with the same
reimbursement rules as apply to payments to providers of services of
the same type under Medicare. TRICARE provider reimbursement methods
are found at 32 CFR 199.14. When it is not practicable to adopt
Medicare's methods or Medicare has no established reimbursement
methodology (e.g. Medicare does not reimburse freestanding SUDRFs or
PHPs that are not hospital-based or part of a Community Mental Health
Clinic, while TRICARE does), TRICARE establishes its own rates through
proposed and final rulemaking.

B. Summary of the Major Provisions of the Final Rule

1. Eliminating Unnecessary Quantitative and Non-Quantitative Treatment
Limitations on SUD and Mental Health Benefit Coverage and Aligning
Beneficiary Cost-Sharing for Mental Health and SUD Benefits With Those
Applicable to Medical/Surgical Benefits
This final rule makes a number of comprehensive revisions to the
TRICARE mental health and SUD treatment coverage. In an effort to
further de-stigmatize SUD care, treatment of SUDs is no longer
separately identified as a limited special benefit under 32 CFR
199.4(e) but rather has now been incorporated into the general mental
health provisions in Sec. 199.4(b) governing institutional benefits
and Sec. 199.4(c) governing professional service benefits. Further,
this rule eliminates a number of mental health and SUD quantitative and
non-quantitative treatment limitations, and corresponding waiver
provisions, instead relying on determinations of medical necessity and
appropriate utilization management tools, as are used for all other
medical and surgical benefits. Proposed revisions include eliminating:
All inpatient mental health day limits, following the
statutory revisions to 10 U.S.C. 1079;
The 60-day partial hospitalization and SUDRF residential
treatment limitations;
Annual and lifetime limitations on SUD treatment;
Presumptive limitations on outpatient services including
the six-hours per year limit on psychological testing; the limit of two
sessions per week for outpatient therapy; and limits for family therapy
(15 visits) and outpatient therapy (60 visits) provided in free-
standing or hospital based SUDRFs;
The limit of two smoking cessation quit attempts in a
consecutive 12 month period and 18 face-to-face counseling sessions per
attempt; and
The regulatory prohibition that categorically excludes all
treatment of gender dysphoria.
The rule also changes cost-sharing for mental health treatment for
TRICARE Prime and Standard/Extra beneficiaries to align with the
applicable cost-sharing provisions for other non-mental health
inpatient and outpatient benefits.

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Additionally, revisions clearly identify services that will be cost-
shared on an inpatient (e.g., inpatient admissions to a hospital,
residential treatment center, SUDRF residential treatment program, or
skilled nursing facility) versus outpatient (including partial
hospitalization programs, intensive outpatient treatment services, and
opioid treatment program services) cost-sharing basis to ensure
consistency with the statutory requirements in 10 U.S.C. 1079 and 1086.
In many cases, these modifications to cost-sharing will enhance TRICARE
beneficiary access to care through lower out-of-pocket costs.
2. Expanding Coverage To Include Mental Health and SUD Intensive
Outpatient Programs and Treatment of Opioid Use Disorder
The regulatory language defines and authorizes new services by
TRICARE authorized institutional and individual providers of SUD care
outside of SUDRF settings at Sec. 199.2 and 199.6. Revisions to
treatment benefits at Sec. 199.4 and Sec. 199.6 will allow intensive
outpatient programs (IOPs) for mental health and SUD treatment; care in
opioid treatment programs (OTPs); and outpatient SUD treatment (i.e.,
office-based opioid treatment, psychosocial treatment and family
therapy) by individual TRICARE authorized providers.
3. Streamlining Requirements for Institutional Mental Health and SUD
Providers To Become TRICARE Authorized Providers
Significant revisions to 32 CFR 199.6 eliminate the
administratively burdensome provider certification process and
streamline approval for institutional mental health and SUD providers
to become TRICARE authorized providers. In multiple regions providers
may meet industry standards but do not meet TRICARE certification
requirements. Consequently, providers in these regions were unable to
serve TRICARE beneficiaries. The applicable provisions for residential
treatment centers, psychiatric and SUD partial hospitalization
programs, and SUDRFs, have been rewritten in their entirety to address
institutional provider eligibility, organization and administration,
participation agreement requirements and any other requirements for
approval as a TRICARE authorized provider. The requirement and formal
process of certification will be eliminated. Similarly, new regulatory
provisions for the newly recognized categories of institutional
providers, namely IOPs and OTPs are instituted.
4. TRICARE Reimbursement Methodologies for Newly Recognized Mental
Health and SUD Intensive Outpatient Programs and Opioid Treatment
Programs
Finally, amendments to 32 CFR 199.14, which specifies provider
reimbursement methods, establish allowable all-inclusive per diem
payment rates for psychiatric and SUD, PHP, IOP and OTP services.

C. Costs and Benefits

The amendment is not anticipated to have an annual effect on the
economy of $100 million or more. An independent government cost
estimate found that this rule is estimated to have a net increase in
costs of approximately $58 million. The government's regulatory impact
analysis based on this cost estimate can be found in the docket folder
associated with this proposed rule [at DOD-2015-HA-0109]. To summarize,
provisions to implement mental health parity account for approximately
$36 million (62%) of the $58 million net cost increase. While modifying
mental health cost-sharing will increase costs, these revisions are
required as the former statutory authority for mental health-specific
cost sharing has been deleted from the statute (section 703 of the NDAA
for FY15). As a result, the existing statutory cost-shares are utilized
and this aligns mental health cost-shares with the current medical-
surgical cost-shares. The largest cost increase ($21.6 million) is
attributable to lowering outpatient mental health cost-sharing for Non-
Active Duty Dependent (NADD) TRICARE beneficiaries (from $25 per visit
to the medical/surgical outpatient cost-sharing of $12 per visit).
Elimination of the statutory day limits for inpatient psychiatric
and Residential Treatment Center (RTC) care for children (to comply
with section 703 of the NDAA for FY15) will only minimally increase
costs. This is because these previously published presumptive day
limits were also subject to waivers and TRICARE had been reimbursing
for medically necessary inpatient stays with waivers when continued
medical necessity was supported. Eliminating the limit of two sessions
per week for outpatient therapy is estimated to incur an increased cost
($7.5 million), but this is based on the conservative assumption that
the proportion of NADD beneficiaries who will pursue three
psychotherapy sessions per week is comparable to the proportion of
Active Duty Service Members (ADSMs) who do so (17%), even though ADSMs
incur no cost-sharing and most receive psychotherapy within MTFs
instead of civilian providers. Eliminating other limits (e.g., annual
and lifetime limits on SUD treatment, smoking cessation program limits,
and others as outlined above) will have a relatively minimal increase
in costs. Overall, the benefit of removing these quantitative limits to
mental health treatment will ensure that all beneficiaries receive the
appropriate amount of care based on medical and psychological
necessity.
Creating additional levels, providers, and types of mental health
care (e.g., intensive outpatient programs, opioid treatment programs,
non-surgical coverage for gender dysphoria, and also allowing
outpatient substance use treatment) will increase costs to the program
by approximately $19 million. Some of the cost increases will be offset
through utilization of lower and less expensive levels of care (e.g.,
IOP versus residential or full day PHP) and prevention of relapse
requiring more costly, intensive inpatient intervention. Previously,
PHPs were the only step-down care from inpatient substance use disorder
treatment covered by TRICARE. In many rural and sparely-populated
states, there are relatively few PHPs (on average 20 or fewer, with 4
states having fewer than 10 PHPs). IOPs in these rural states, on the
other hand, are four times more plentiful than PHPs, and TRICARE
coverage of IOP substance use disorder treatment will greatly increase
beneficiary access to SUD treatment, particularly in these remote
geographic areas. Coverage of outpatient SUD treatment by TRICARE
authorized individual providers will facilitate early intervention for
SUDs and help reduce relapse following more intensive treatment through
the availability of outpatient aftercare from these professionals.
Additionally, TRICARE currently has an estimated 15,000 to 20,000
beneficiaries with opioid use disorder who, under the previous benefit,
could not access medication-assisted treatment (MAT; e.g.,
buprenorphine or methadone). According to SAMHSA, there are
approximately 1400 OTPs in the United States and 31,363 physicians with
a DEA waiver to provide MAT for opioid use disorder, but none of these
facilities or providers is TRICARE-authorized or eligible to be
reimbursed by TRICARE under current regulation. Under these regulatory
changes, TRICARE beneficiaries will have ready access to MAT on an
outpatient basis as recommended by ASAM and clinical practice
guidelines developed jointly by the Department of Veterans Affairs (VA)
and DoD.

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Streamlining requirements for institutional providers to become
TRICARE authorized providers of mental health and SUD care will incur
an estimated increased cost of $3.2 million due to an anticipated
increase in the number of institutional providers joining the TRICARE
network. To focus on RTC care as an example, TRICARE strives to provide
a robust mental health treatment benefit to our child beneficiaries,
but access to RTC care for children is significantly limited in many
geographic areas by TRICARE's existing certification requirements. Less
than one sixth of RTCs accredited by the Joint Commission are currently
TRICARE certified, and only about one half of individual states have at
least one TRICARE certified RTC. Revising TRICARE institutional
provider authorization requirements for RTCs will make it much more
likely that parents will seek RTC care for their children whose
behavioral health condition is so severe as to require RTC services,
and this change to the TRICARE behavioral health benefit is projected
to increase utilization of RTC services by 20 percent. Ultimately, the
net increase in costs associated with this final rule will greatly be
outweighed by the enhanced mental health benefits, options and access
available to beneficiaries.

D. Public Comments

On February 1, 2016 (81 FR 5061-5086), the Office of the Secretary
of Defense published a proposed rule for a 60-day public comment
period, and provided an opportunity to comment on implementing changes
to TRICARE benefits. As a result of publication of the proposed rule,
DoD received 290 comments. A large majority of commenters expressed
overwhelming support for the rule change, while others expressed
concerns about the cost and necessity of the proposed changes. We thank
all those who provided comments. Specific matters raised by those who
submitted comments are summarized below in the appropriate sections of
the preamble.

II. Provisions of the Rule Regarding Eliminating Unnecessary
Quantitative and Non-Quantitative Treatment Limitations on SUD and
Mental Health Benefit Coverage and Aligning Beneficiary Cost-Sharing
for Mental Health and SUD Benefits With Those Applicable to Medical/
Surgical Benefits

A. Eliminating Unnecessary Quantitative and Non-Quantitative Treatment
Limitations on SUD and Mental Health Benefit Coverage

1. Provisions of the Proposed Rule. This final rule will remove a
number of unnecessary quantitative and non-quantitative limits for
coverage of mental health and SUD care under the TRICARE Program,
including:
All inpatient mental health day (30 days maximum for
adults and 45 days maximum for children at 32 CFR 199.4(b)(9)) and
annual day limits (150 days at 32 CFR 199.4(b)(8)) for RTC care for
beneficiaries 21 years and younger, following the statutory revisions
to 10 U.S.C. 1079;
The 60-day limitation on partial hospitalization (32 CFR
199.4(b)(10)(iv)) and SUDRF residential treatment (32 CFR
199.4(e)(4)(ii)(A));
Annual (60 days in a benefit period) and lifetime (three
treatment episodes--32 CFR 199.4(e)(4)(ii)) limitations on SUD
treatment;
Presumptive limitations on outpatient services including
the six-hour per year limit on psychological testing (32 CFR
199.4(c)(3)(ix)(A)(5)) and the limit of two sessions per week for
outpatient therapy (32 CFR 199.4(c)(3)(ix)(B));
Limits on family therapy (15 visits (32 CFR
199.4(e)(4)(ii)(C)) and outpatient therapy (60 visits--(32 CFR
199.4(e)(4)(ii)(B)) provided in free-standing or hospital based SUDRFs;
and
The limit of two smoking cessation quit attempts in a
consecutive 12 month period and 18 face-to-face counseling sessions per
attempt (32 CFR 199.4(e)(30)).
This rule will also allow coverage of outpatient treatment that is
medically or psychologically necessary, including psychotherapy, family
therapy and other covered diagnostic and therapeutic services, by a
TRICARE authorized institutional provider or by authorized individual
mental health providers without limits on the number of treatment
sessions. All claims submitted for services under TRICARE remain
subject to review for quality and appropriate utilization in accordance
with the Quality and Utilization Review Peer Review Organization
Program, under 10 U.S.C. 1079(n) and 32 CFR 199.15.
The rule also removes certain regulatory exclusions for the
treatment of gender dysphoria for TRICARE beneficiaries who are
diagnosed by a TRICARE authorized provider, practicing within the scope
of his or her license, to be suffering from a mental disorder, as
defined in 32 CFR. 199.2. It is no longer justifiable to categorically
exclude and not cover currently accepted medically and psychologically
necessary treatments for gender dysphoria (such as psychotherapy,
pharmacotherapy, and hormone replacement therapy) that are not
otherwise excluded by statute. (Section 1079(a)(11) of title 10,
U.S.C., excludes from CHAMPUS coverage surgery which improves physical
appearance but is not expected to significantly restore functions,
including mammary augmentation, face lifts, and sex gender changes.)
2. Analysis of Major Public Comments. Many commenters expressed
strong support for the removal of presumptive quantitative limitations
on mental health treatment benefits, such as elimination of inpatient
mental health day limits, the previous six hours per year limit on
psychological testing, the limit of two sessions per week for
outpatient therapy, and the limit of two smoking cessation quit
attempts in a consecutive 12 month period. One commenter specifically
suggested a raised limit on the number of smoking cessation quit
attempts in a consecutive 12 month period. There was also one specific
expression of support for the inclusion of music therapy as an
ancillary therapy. One commenter noted that individuals with substance
use disorders should be allowed only one treatment episode, and
subsequent to this, benefit coverage for SUD treatment should be
suspended.
Response: We appreciate the overwhelming support for these proposed
changes which will reduce unnecessary administrative barriers and
ensure ready access to medically necessary care for our beneficiaries.
In response to the general concerns regarding cost and necessity for
the proposed changes we would emphasize that while specific,
presumptive quantitative treatment limitations have been eliminated,
mental health and SUD care will still be reviewed for continued medical
necessity and subject to utilization management review, as is all care
under the TRICARE program. We believe this approach provides an
appropriate balance between reducing administrative barriers to care
while still ensuring appropriate utilization. Regarding allowance of
only one

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treatment episode for SUD care, this is far less than the Department's
previous allowance of three episodes of treatment for SUD care. The
removal of these limitations recognizes that SUDs are chronic
conditions with periodic phases of relapse and readmission, often
requiring multiple interventions over several years to achieve full
remission. With respect to the suggestion to raise the limit on smoking
cessation quit attempts, the Department's approach of eliminating all
presumptive quantitative limitations makes such a recommendation
unnecessary. Finally, with respect to music therapy, we would note that
while it is not recognized as a primary mental health or SUD treatment
modality, it remains a covered ancillary therapy benefit solely when
provided in the context of an approved inpatient, SUDRF, residential
treatment, partial hospitalization, or intensive outpatient program
treatment plan and under the clinical supervision of a qualified mental
health professional.
Comment: Multiple national organizations sent comments requesting a
definition of the term ``qualitative'' treatment limits as used in the
proposed rule to be consistent with the MHPAEA, citing that the MHPAEA
uses only the terms ``quantitative'' and ``non-quantitative'' treatment
limits. While applauding TRICARE's removal of quantitative treatment
limits (QTLs), some argued that the rule should go farther to achieve
parity in accordance with the MHPAEA, and cited sections of regulation
they perceived as non-quantitative treatment limitations (NQTLs) that
are inconsistent with the MHPAEA, such as those: Requiring utilization
review, quality assurance and reauthorization for inpatient mental
health services and partial hospitalization at 199.4(a)(11) and (12);
outlining medical necessity criteria for institutional providers of
mental health treatment at 199.4(b); and, providing descriptions and
requirements for mental health providers at 199.6(b) that were
perceived as more detailed than those for medical/surgical settings.
Several commenters also suggested that since compliance with the letter
and the spirit of mental health parity rules has been inconsistent,
that TRICARE issue clear guidance regarding enforcement of its
requirements as well as establish a systemized way of collecting
information from medical providers and enrollees about compliance.
Several other commenters specifically requested that the final rule
explicitly require issuers and plans to perform a compliance review of
the plan or issuer's financial requirements regarding QTLs and NQTLs
applied by the plan or issuer; and require plans and issuers to provide
documentation that illustrates how the health plan has determined the
financial requirements, QTLs and/or NQTLs are in compliance. Finally,
one commenter noted that while they understood that TRICARE was not
subject to the MHPAEA statute, they were not aware of any statutory
prohibition which would preclude a complete modeling of its MH/SUD
benefits with MHPAEA's qualitative, or NQTL, treatment limitation
requirements.
Response: The Department appreciates the comments regarding
``qualitative'' or ``non-quantitative'' treatment limitations (NQTLs)
and apologizes for any confusion created in the proposed rule by not
following the same terminology used in the MHPAEA. In this final rule,
the term ``non-quantitative'' has been substituted for ``qualitative''
for clarity and consistency.
The Department believes that it is important to note that TRICARE
is a program of medical benefits provided by the U.S. Government under
public law to specified categories of individuals who are qualified for
those benefits by virtue of their relationship to one of the seven
Uniformed Services. In response to the public comments citing general
challenges with plan disclosure requirements and problems with
noncompliance and inconsistent application of NQTLs by issuers and
plans subject to the MHPAEA, the Department stresses that TRICARE is a
statutory entitlement program; it is not health insurance and it is not
administered through issuers or plans. As addressed in greater detail
in the supplementary information background section of the proposed
rule, TRICARE is not a group health plan subject to the MHPA of 1996,
the MHPAEA of 2008, or the Health Care Reconciliation Act of 2010.
Unlike private insurers, TRICARE is a federal entitlement program of
uniform benefits, as outlined in law and regulations, for eligible
beneficiaries. Benefit design is dictated by federal statute and
regulation, as are patient deductibles and cost-sharing, provider
reimbursement, and the rules and procedures regarding quality and
utilization review. Further, federal regulations at 32 CFR 199.10 set
forth the policies and procedures for appealing decisions. Therefore,
while the provisions of these acts served as a model for TRICARE in
proposing changes to existing benefit coverage so as to reduce
unnecessary administrative barriers to treatment and increase access to
medically necessary mental health care consistent with TRICARE
statutory authority, the Department does not believe it is necessary or
appropriate to incorporate into the TRICARE regulation suggested
enforcement provisions applicable to issuers and plans.
We would also like to respond to the specific comments and
recommendations we received that suggested additional revisions to
existing TRICARE regulatory provisions could be made to achieve greater
alignment and parity with medical/surgical benefits. First, one
commenter suggested that the preauthorization, utilization review and
quality assurance requirements for mental health care at Sec.
199.4(a)(11) and (12) constitute NQTLs and should be eliminated. The
Department emphasizes that all health care services for which
reimbursement is sought under TRICARE are subject to review for quality
of care and appropriateness of utilization as required by statute, 10
U.S.C. 1079(n). TRICARE's Quality and Utilization Review Peer Review
Organization Program at 32 CFR 199.15 prescribes the objectives,
requirements and procedures for how TRICARE addresses quality
assurance, reauthorization and other utilization review practices for
all health care services, including medical and surgical care. With
that said, the Department is committed to removing unnecessary
quantitative and non-quantitative treatment limitations and simplifying
our regulations where it makes sense. In re-reviewing the existing
regulatory language in Sec. 199.4(a)(11) and (12), we agree that the
language is unnecessary and should be eliminated. With the remaining
regulatory provisions that are applicable to all covered services,
including both medical/surgical as well as mental health/SUD, there is
no need to separately address quality and utilization review of mental
health services. Therefore, within Sec. 199.4, the parenthetical
reference to utilization and quality review of mental health services
in paragraph (a)(11) has been removed. Additionally, paragraph (a)(12)
regarding utilization and quality review specifically for inpatient
mental health and partial hospitalization has been removed and the
paragraph reserved.
Additionally, the same commenter raised concerns that specific
medical necessity criteria were included within the regulatory language
under Sec. 199.4 for mental health and SUD services while similar
medical necessity criteria were not specified for medical/surgical
services and settings. While the

[[Page 61073]]

Department appreciates the comment, we have elected to retain this
regulatory language as having these medical necessity criteria in
regulation is instructive and informative for all stakeholders in
administering the TRICARE benefit. Further, we do not believe these
criteria are discriminatory or unnecessary but rather are reflective of
the overarching statutory requirement that care be medically necessary
and appropriate. These terms (``medically or psychologically
necessary'' and ``appropriate medical care'') are further defined in
regulation at Sec. 199.2. These same requirements apply to TRICARE
medical and surgical benefits. The language where included in Sec.
199.4 is specifically tailored to address medically necessity in that
context, particularly with respect to the different levels of care that
are available for the treatment of mental health and SUD that do not
have a corresponding medical or surgical counterpart. The Department
has also sought to strike an appropriate balance between eliminating
unnecessary language and regulatory provisions while at the same time
ensuring transparency in program administration.
Regarding comments that the Department set forth more elaborate
descriptions and requirements for mental health institutional providers
than for medical/surgical settings, a major objective of this rule has
been to achieve significant streamlining of the descriptions and
requirements for TRICARE authorization of institutional mental health
care providers under Sec. Sec. 199.6(b)(4)(vii) (RTCs),
199.6(b)(4)(xii) (PHPs), and 199.6(b)(4)(xiv) (SUDRFs) and we believe
we have achieved that objective. The proposed revisions which are
finalized in this rule have eliminated a large portion of the existing
descriptions and requirements for existing mental health/SUD
institutional providers. For each type of provider, the amended
regulation includes a definition/general description of the type of
institutional provider and eligibility requirements including
licensing, accreditation, a written participation agreement and
adherence to general TRICARE requirements. We have eliminated the
elaborate descriptions that are contained in the existing regulations
regarding such things as the organization of the facility and specific
qualifications of the governing body (including the facility's Chief
Executive Officer, Clinical Director, Medical Director and Medical or
professional staff organization), staff composition, staff
qualifications, admission process, assessments, treatment planning,
discharge and transition planning, standards for physical plant and
environment and a variety of other requirements that we believe are
more appropriately satisfied through a national accreditation process.
Similarly, we have also eliminated the requirements regarding capacity
(30 percent) and length of time licensed and at full operational status
(6 months) for OTPs, RTCs, PHPs, IOPs, and SUDRFs.
Furthermore, we would note the general requirement in Sec.
199.6(a)(8)(i) that all institutional providers must be participating
providers under TRICARE. Hospitals (whether providing medical/surgical
and/or mental health/SUD care) that are certified and participating
under Medicare are deemed to meet TRICARE requirements and are not
required to request TRICARE approval formally. (See Sec. 199.6(b)(3).)
Section 199.6 lists a variety of additional institutional providers,
some of the medical/surgical variety (including, for example, skilled
nursing facilities, freestanding ambulatory surgery centers, birthing
centers, hospice programs, and home health agencies) and others that
are mental health and SUD providers, which require specific approval to
become TRICARE authorized institutional providers.
With respect to comments about specific requirements for inclusion
in participation agreements, all institutional providers are required,
under Sec. 199.6(8)(i)(A), to be a participating provider under
TRICARE, and the general provisions that must be included in the
agreement are outlined in regulation at Sec. 199.6(a)(13) and are
equally applicable to medical/surgical and mental health/SUD
institutional providers. In general, we believe the specific
requirements outlined in Sec. 199.6(b) are reflective of the general
participation agreement requirements and simply tailored to the
particular type of provider (so for instance, when requiring that the
participating provider agree to accept the determined allowable amount,
the regulatory provisions cross reference to the applicable
reimbursement methodology for that type of provider). Again, we have
sought to balance the competing interests of streamlining our
regulations to the extent practicable with ease of reference for the
reader, coupled with our commitment to ensuring transparency in program
requirements. Further, these participation agreements ensure providers
accept assignment on TRICARE claims, thereby protecting our
beneficiaries from financial liability above their applicable
deductibles and cost-shares, and ensure compliance with applicable
program requirements in support of the provision of safe, quality care
to our beneficiaries.
Additionally, while we wanted to address the general mental health
parity comments here, several of the specific requirements for mental
health and SUD institutional providers contained in Sec. 199.6 and
referenced in public comments are more appropriately addressed below in
the following sections.
Comment: Nineteen respondents expressed strong objection to the
addition of benefit coverage for the diagnosis of gender dysphoria
citing cost concerns and an inappropriate use of taxpayer funds.
Several commenters expressed concerns about impact on military units
and military readiness resulting from the treatment of transgender
Service Members. Sixteen respondents commented in support of the
proposed rule's addition of benefit coverage for psychological and
medical care for gender dysphoria. Four respondents expressed objection
to surgical coverage of gender dysphoria under the proposed rule. Two
commenters expressed objection based on the conscience rights and first
amendment liberties of those who work in the healthcare field and urged
the retention of the regulatory exclusion as the diagnosis and
treatment of gender dysphoria remains medically controversial.
Conversely, several national organizations cited support for the
addition of benefit coverage for the diagnosis of gender dysphoria but
expressed significant objection to the exclusion of surgical treatment
for gender dysphoria.
Response: The Department proposed to remove the exclusion on non-
surgical treatment of gender dysphoria as it is no longer justifiable
to categorically exclude and not cover current medical and
psychologically necessary and appropriate proven treatments that are
not otherwise excluded by law. Section 1557 of the Affordable Care Act
prohibits discrimination on the basis of race, origin, sex, disability,
or age (consistent with the scope of Title VI of the Civil Rights Act
of 1964, Title IX of the Education Amendments of 1972, section 504 of
the Rehabilitation Act of 1973, and the Age Discrimination Act of
1975). HHS recently released a final rule implementing Section 1557.
That rule prohibits discrimination based on gender identity (incident
to the Title IX ban on sex discrimination) in health programs. The rule
by its terms applies only to HHS programs, but the statute applies to
all federal health programs, and DoD considers these portions (45 CFR
92.206, 92.207) of the HHS rule

[[Page 61074]]

relevant guidance for purposes of administering TRICARE. Notably, the
HHS regulation does not say plans must cover all gender transition
related health care, just that they should not exclude all coverage for
gender dysphoria, a mental health diagnosis established in the
Diagnostic and Statistical Manual of Mental Disorders, Fifth Edition
(DSM-5). DoD agrees that to the extent the Department has discretion,
prevailing medical assessments and nondiscrimination principles call
for removal of this categorical exclusion. With respect to the public
comments regarding military readiness, we would note that this TRICARE
rule does not control policies and practices regarding treatment of
gender dysphoria in Active Duty Service Members. Additionally, there is
nothing in this rule that requires providers to render care against
their beliefs. Existing policies allow DoD providers who, as a matter
of conscience or moral principle, do not wish to provide psychotherapy,
psychopharmacological, or hormone treatment, to request excusal from
any such involvement. Regarding commenters' concerns about the cost of
non-surgical treatment of gender dysphoria, the Department does not
believe cost estimates are at all substantial or out of line with
treatment of other medical or psychological conditions covered by
TRICARE and most health plans.
Surgical coverage of gender dysphoria was not included in the
proposed rule, is not included in this final rule, and remains
prohibited by statute at 10 U.S.C. 1079(a)(11). Several commenters
argued the rule did not go far enough and others suggested the
Department reconsider including coverage for transgender surgeries.
Several argued the statutory exclusion was otherwise not applicable or
ambiguous, must be interpreted in accordance with modern medical
science and contemporary standards of care, and thus should not be read
to exclude medically necessary surgical care to treat gender dysphoria.
The pertinent statutory provision (10 U.S.C. 1079(a)(11)) states:
``Surgery which improves physical appearance but is not expected to
significantly restore functions (including mammary augmentation, face
lifts, and sex gender changes) may not be provided. . . .'' The statute
lists three exceptions--breast reconstructive surgery following a
mastectomy, reconstructive surgery to correct serious deformities
caused by congenital anomalies or accidental injuries, and neoplastic
surgery. Some commenters believed that DoD could disregard the listing
of ``sex gender changes'' in the parenthetical examples of surgery
``which improves physical appearance but is not expected to
significantly restore functions'' because it is contrary to modern
medical assessment and because they believe there is Supreme Court
precedent \1\ for disregarding a parenthetical example misaligned with
the proposition for which it is listed as an example. However, in that
Supreme Court case, the Court concluded that the parenthetical example
at issue was ``a drafting mistake''--``an example that Congress
included inadvertently''--resulting from a failure to make conforming
adjustments as changes in the draft legislation were made through the
process.\2\ That circumstance does not apply to the statutory provision
at issue here. Commenters did not provide any other justification that
allows DoD to disregard this unambiguous specification. While some
commenters have argued that sex-gender changes should not be considered
cosmetic, elective or unnecessary, and should be seen as surgery to
significantly restore areas of social, psychological and physical
functioning that may have been impaired by gender dysphoria, the
statutory language itself is focused on restoring function of the body
part upon which surgery is performed. As noted above, Congress has
enacted several exceptions to the general prohibition on surgeries that
are not expected to significantly restore functions. As a statutory
entitlement program, the Department is constrained in its authority
absent a legislative change. The final regulatory language is dictated
by statute and is not meant to imply any Departmental position
regarding the medical necessity of surgical treatment.
---------------------------------------------------------------------------

\1\ Chickasaw Nation v. United States, 534 U.S. 84, 91 (2001).
\2\ Id.
---------------------------------------------------------------------------

3. Provisions of the Final Rule. The final rule is consistent with
the proposed rule except that sections making specific reference to
mental health inpatient and partial hospitalization utilization review,
quality assurance, and reauthorization requirements have been removed
at Sec. 199.4(a)(11) and (12).

B. Aligning Beneficiary Cost-Sharing for Mental Health and SUD Benefits
With Those Applicable to Medical/Surgical Benefits

1. Provisions of the Proposed Rule. Following the recent repeal of
statutory authority for separate beneficiary financial liability for
mental health benefits, the rule eliminates any differential in cost-
sharing between mental health and SUD benefits and medical/surgical
benefits. The regulatory changes to 32 CFR 199.4(f) and 32 CFR 199.18
will reduce financial barriers to both outpatient and inpatient mental
health and SUD benefits while, consistent with statutory requirements,
minimize out-of-pocket risk for those beneficiaries.
With respect to TRICARE Prime co-payments, active duty family
members (ADFMs) enrolled in TRICARE Prime will continue to pay no
copayment for inpatient or outpatient services. Retirees and all other
non-active duty dependents enrolled in Prime will see the following
changes:
The co-pay for individual outpatient mental health visits
will be reduced from $25 to $12.
The co-pay for group outpatient mental health visits will
be reduced from $17 to $12.
The per diem charge of $40 for mental health and SUD
inpatient admissions will be reduced to the non-mental health per diem
rate of $11, with a minimum charge of $25 per admission.
Regarding TRICARE Standard cost-sharing, ADFMs utilizing TRICARE
Standard/Extra previously paid a higher per diem for mental health
inpatient care than for other inpatient stays. ADFMs will see the
following change:
The per diem cost-share for inpatient mental health
services will be reduced from $20/day to the daily charge ($18/day for
FY16) that would have been charged had the inpatient care been provided
in a Uniformed Services hospital.
Retirees and their dependents who are not enrolled in Prime but use
non-network providers (Standard) for mental health care are generally
required to pay 25% of the allowable charges for inpatient care, and
this will not change. Retirees and their dependents using Standard and
Extra are currently responsible for their outpatient deductible and
outpatient cost-sharing of 25% (Standard)/20% (Extra) of the CHAMPUS-
determined allowable costs. This also will not change.
Cost-sharing for partial hospitalization programs (PHPs) will
change from inpatient to outpatient to more accurately reflect the
services being rendered, ensure consistency with the applicable
statutes governing cost-sharing, and to further ensure parity between
the surgical/medical and mental health benefit. Congress revoked the
statutory authority granted to the Secretary to establish different
cost-shares for mental health care. These factors provided the impetus
for adoption of outpatient cost-sharing for

[[Page 61075]]

PHPs. As noted above, ADFMs enrolled in TRICARE Prime/Prime Remote, do
not pay co-pays for inpatient or outpatient services. For retirees and
their dependents enrolled in Prime, the current inpatient per diem
charge of $40 for partial hospitalization program services will be
reduced to an outpatient co-pay of $12 per day of services. Realigning
cost-sharing of partial hospitalization program services from inpatient
to outpatient will impact ADFMs utilizing TRICARE Standard/Extra.
Specifically, for ADFMs, the previous inpatient per diem charge of $20/
day (with a minimum $25 charge per admission) for partial
hospitalization program services will instead be subject to the
applicable outpatient deductible and cost-sharing of 20% (Standard)/15%
(Extra) of the PHP per diem rate. However, these ADFMs will still
retain the option of enrolling in TRICARE Prime/Prime Remote, where the
cost-sharing is $0 (i.e., no cost-sharing is applied). The financial
liability of ADFMs under Extra and Standard will be further limited by
the annual $1000 catastrophic cap. Analyses conducted for the
Regulatory Impact Analysis regarding this change indicated that only an
estimated 50 to 80 additional non-Prime ADFMs may reach the
catastrophic cap due to the higher PHP cost sharing.
2. Analysis of Major Public Comments. Numerous commenters agreed
that differential cost-sharing requirements have served as a further
disincentive for individuals seeking treatment, and agree that aligning
cost-sharing requirements will reduce financial barriers for consumers
on both inpatient and outpatient mental health and SUD benefits while
minimizing out-of-pocket risks for beneficiaries. One commenter noted
concern regarding having retirees and their dependents pay higher
copays, given high unemployment and homelessness rates among Veterans.
Response: We appreciate all of the comments in support of this
important change. With respect to retirees and their dependents paying
higher copays, we believe this may have been a misunderstanding of
general statutory and regulatory requirements regarding TRICARE cost-
sharing, and what was specifically being proposed in the rule. In
general, retirees and their dependents do pay more out-of-pocket costs
than ADFMs. These requirements are outlined in statute and outside the
scope of this rule. The intent of the rule itself is to provide parity
in cost sharing between medical/surgical benefits and SUD/mental health
benefits as applied to each beneficiary class. Previously retirees and
their dependents enrolled in Prime paid higher copays for inpatient and
outpatient mental health services than for inpatient and outpatient
medical/surgical health services. However, under the final rule
retirees and all other non-active duty dependents enrolled in Prime
will see reductions in individual outpatient and group outpatient
mental health visits from a previous rate of $25 and $17 respectively,
to a rate of $12. Our intent throughout is not to restrict access to
care, but to provide equitable access to medically necessary care for
all beneficiary groups.
3. Provisions of the Final Rule. The final rule is consistent with
the proposed rule, and no substantive changes were made regarding
beneficiary cost-sharing for mental health and SUD benefits.

III. Provisions of the Rule Regarding Expanding Coverage To Include
Mental Health and SUD Intensive Outpatient Programs and Treatment of
Opioid Use Disorder

A. Intensive Outpatient (IOP) Care for Psychiatric and Substance Use
Disorders

1. Provisions of the Proposed Rule. Mental health and SUD IOP
services were not previously identified as separate levels of care from
partial hospitalization in TRICARE regulations. Although hospital-based
and free-standing facilities that are TRICARE authorized to offer
partial hospitalization services can provide less intensive IOP,
covered at the half-day partial hospitalization rate, the previous
TRICARE certification requirements for these programs restricted the
typical mental health or SUD IOP from being recognized as a distinct
covered benefit and TRICARE-authorized institutional provider type. SUD
IOPs offer a validated level of care endorsed by ASAM, and the
provision of mental health and SUD IOP services will better accommodate
patients who require step-down services from an inpatient stay or a
PHP. Explicit authorization of IOP is also anticipated to expand the
number of TRICARE participating providers and improve access to care.
IOP care institutional providers will be required to be accredited by
an accrediting body approved by the Director, Defense Health Agency,
and meet the requirements outlined in 32 CFR 199.6(b)(4)(xviii) to
become TRICARE authorized.
2. Analysis of Major Public Comments. Several national
organizations and many commenters expressed strong support for the
authorization of new services for SUD care outside of SUDRF settings,
citing the need for additional treatment options consistent with the
full range of the continuum of care. One national organization also
requested clarification regarding application processes and contract
amendments for existing TRICARE providers who serve patients in their
PHP services but who would want to expand their services to include the
new IOP level of care.
Response: The Department agrees and sought these revisions to
ensure ready access to medically necessary treatment reflective of the
full continuum of evidence-based care. The Department understands
comprehensive SUD treatment must include access to various levels of
care, ranging from acute detoxification to treatments that focus on
stabilization and maintenance of treatment gains. While Sec. 199.6
(b)(4)(xviii) establishes standards and requirements for intensive
outpatient treatment programs for psychiatric and substance use
disorders, further details regarding participation, billing, and
accreditation standards will be outlined in the TRICARE manuals
available online at http://manuals.tricare.osd.mil. With respect to
institutional providers who would like to expand their services, we
would note that the regulatory language regarding participation
agreements specifically acknowledges that a single consolidated
participation agreement is acceptable for all units of a TRICARE
authorized facility granted that all programs meet the applicable
requirements. Once implemented, interested facilities should work
directly with the applicable managed care support contractor for their
region to establish and/or modify their participation agreement.
3. Provisions of the Final Rule. The final rule is consistent with
the proposed rule, and no substantive changes were made with respect to
Intensive Outpatient (IOP) care for Psychiatric and Substance Use
Disorders.

B. Treatment of Opioid Use Disorder

1. Provisions of the Proposed Rule. This rule expands treatment of
opioid use disorder, with the provision of medication assisted
treatment (MAT), through both TRICARE authorized institutional and
individual providers. In addition to SUD IOPs, this rule allows TRICARE
coverage of opioid treatment programs (OTPs), with the inclusion of a
definition of OTPs in 32 CFR 199.2 and the requirements for OTPs to
become TRICARE authorized institutional providers outlined in 32

[[Page 61076]]

CFR 199.6(b)(4)(xix). Additionally, this rule allows coverage of OBOT,
as defined in 32 CFR 199.2, and coverage of MAT on an outpatient basis
as extended in 32 CFR 199.4(c)(3)(ix)(A)(9).
2. Analysis of Major Public Comments. A number of commenters, along
with multiple national organizations sent comments in support of the
addition of benefit coverage to include opioid treatment programs,
noting opioid addiction is a significant national problem. One
commenter stated that individuals with opioid use disorder should not
be provided any form of treatment as this represented a waste of
government funds. One national organization commented that there are
actually approximately 1400 OTPs in existence. Also, several commenters
requested that TRICARE clarify capacity requirements for OTPs and
include the right to request a waiver to this requirement. One
commenter queried how and if quality tracking of the newly authorized
providers will be performed and by which department.
Response: Recent increases in prescription opioid misuse and heroin
addiction make provision of MAT in OTPs and OBOT settings a timely and
necessary addition to benefit coverage. We do not agree with the
commenter who noted that treatment should be withheld for individuals
with opioid use disorder, and we note that MAT is an effective,
evidence-based treatment for opioid use disorder that should be
provided by TRICARE as medically necessary and appropriate treatment.
We appreciate the comment regarding the approximate number of OTPs in
existence and are hopeful many of these facilities will elect to become
TRICARE participating providers. With respect to the proposed
regulatory requirement that OTPs are required to be licensed and fully
operational for a period of at least six months with a minimum patient
census of at least 30 percent of capacity, we understand from several
commenters that unlike inpatient and residential facilities, OTPs may
not have a stated capacity as part of their licensure, and as a result,
it may not be clear as to whether or not OTPs have met this
requirement. We appreciate this issue being brought to our attention
and have decided to remove the explicit capacity requirement for OTPs
from the regulation. TRICARE will simply require OTPs to be licensed
and operate in substantial compliance with state and federal
regulations.
3. Provisions of the Final Rule. The final rule is consistent with
the proposed rule and the only substantive change made regarding
provisions for the treatment of opioid use disorder was removal of an
explicit capacity requirement for OTPs contained in Sec.
199.6(b)(xix)(A)(2)(ii).

C. Outpatient Substance Use Disorder Treatment by Individual
Professional Providers

1. Provisions of the Proposed Rule. By previous regulation,
reimbursement for office-based SUD outpatient treatment provided by
TRICARE authorized individual mental health providers, as specified in
32 CFR 199.6, was not permitted. Such outpatient SUD treatment services
were only authorized when provided by a TRICARE approved institutional
provider (i.e., a hospital-based or free-standing SUDRF). However,
although some accredited TRICARE-authorized SUDRFs provide office-based
SUD outpatient treatment, institutional providers of SUD care primarily
provide services to patients requiring a higher level of SUD care. To
address this limitation in access, the Department proposed expanded
coverage to include individual outpatient SUD care, including office-
based outpatient treatment.
This rule covers services of TRICARE-authorized individual mental
health providers, practicing within the scope of their licensure or
certification, who offer medically or psychologically necessary SUD
treatment services (including outpatient and family therapy) outside of
a SUDRF, to include MAT and treatment of opioid use disorder by a
TRICARE authorized physician delivering OBOT on an outpatient basis.
2. Analysis of Major Public Comments. Again, national organizations
and many commenters expressed strong support for the authorization of
new services for SUD care outside of SUDRF settings, citing the need
for additional treatment options consistent with the full range of the
continuum of care and appropriate access to evidence-based care. Eight
commenters requested additional SUD individual professional provider
types be recognized by TRICARE as authorized to provide services. One
commenter also noted that she was unable to provide services as she
does not hold citizenship but suggested volunteers be allowed to
provide services to beneficiaries.
Response: We agree that access to care is important for
beneficiaries seeking SUD treatment. The Department made these
revisions in acknowledgement of the importance of both the availability
and convenience of access to evidence-based care in a range of settings
to include TRICARE authorized, individual office-based providers.
TRICARE appreciates the contributions of peer counselors, and other
non-medical individuals who desire to provide SUD and mental health
services to beneficiaries as well as the skills and professional
experience of the various substance use disorder and mental health
providers in the field. We appreciate these comments but consider them
beyond the scope of this rule as we did not propose any changes to the
existing regulatory requirements for individual professional providers
of care. TRICARE maintains a robust selection of TRICARE eligible
providers by relying on currently recognized provider types. Qualified
mental health providers are: Psychiatrists or other physicians;
clinical psychologists, certified psychiatric nurse specialists,
certified clinical social workers, certified marriage and family
therapists, TRICARE certified mental health counselors, pastoral
counselors under a physician's supervision, and supervised mental
health counselors under a physician's supervision. However, we will
review all recommendations provided and consider them in the
development of future policy. Additionally, the acceptance of volunteer
services is beyond the scope of our proposed rule which addresses the
cost-sharing of medically necessary services and supplies required in
the diagnosis and treatment of an injury, illness or disease when
rendered by a TRICARE authorized provider.
3. Provisions of the Final Rule. The final rule is consistent with
the proposed rule, and no substantive changes were made to provisions
regarding TRICARE coverage of outpatient SUD treatment by individual
professional providers.

IV. Provisions of the Rule Regarding Streamlining Requirements for
Institutional Mental Health and SUD Providers To Become TRICARE
Authorized Providers

1. Provisions of the Proposed Rule. This rule simplifies the
regulation to account for existing industry-wide accepted accreditation
standards for TRICARE institutional providers of mental health care,
including RTCs, freestanding PHPs, and freestanding SUDRFs.
Requirements for TRICARE certification beyond industry-accepted
accreditation, while once considered necessary to ensure quality and
safety, eventually proved to be unnecessarily restrictive and
inconsistent with current institutional provider standards and
organization. Specifically, the final rule streamlines procedures and
requirements for SUDRFs, RTCs, PHPs, IOPs and OTPs to qualify as
TRICARE

[[Page 61077]]

authorized providers, relying primarily on accreditation by a national
body approved by the Director, as opposed to detailed, lengthy, stand-
alone TRICARE requirements (e.g., the qualifications and authority of
the clinical director, staff composition and qualifications, and
standards for physical plant and environment, amongst others). In
general, mental health and SUD institutional providers may become
TRICARE authorized institutional providers if the facility is
accredited by an accrediting organization approved by the Director and
agrees to execute a participation agreement with TRICARE, as outlined
in the regulations. This streamlined approval process is a greatly
simplified process from the previous, detailed certification process
for current institutional providers.
Furthermore, given that there are now a growing number of
accrediting bodies established for institutional providers of mental
health care and industry standards that are widely accepted, the final
rule eliminates by name references to specific accrediting bodies
(e.g., The Joint Commission (TJC)). Instead, the specific mention of
accrediting bodies is replaced with the term, ``an accrediting
organization, approved by Director.'' This will allow the Defense
Health Agency (DHA) flexibility in selecting and recognizing the
authority of various accrediting bodies to assist in authorization of
institutional providers of mental health care and SUD care. Rather than
name all the approved accrediting bodies in regulation, DHA will
identify specific accrediting bodies for various types of mental health
care in TRICARE sub-regulatory policy found at http://manuals.tricare.osd.mil.
2. Analysis of Major Public Comments. Multiple national
organizations and individuals noted strong support for changes in
accreditation requirements as part of the streamlining of the process
for TRICARE approval of institutional providers. Many of these comments
sought to advocate for approval of the Commission on Accreditation of
Rehabilitation Facilities as a TRICARE-approved accrediting
organization. Also, a number of commenters sought to advocate for the
Council on Accreditation, and several others advocated for Outdoor
Behavioral Healthcare Accreditation, to be recognized as approved
accrediting organizations. One commenter noted the positive impact this
will have on community based providers, including enhancing local
economies. Another commenter requested that the Department open TRICARE
networks to any willing and able provider with appropriate credentials,
indicating that paneling need not be made any more complicated. One
commenter specifically discussed the circumstances under which there
were no network providers within one hour of place of residence to
provide care. One commenter requested the Department clearly address
coverage for eating disorder programs. Another commenter expressed
concern that DoD should not propose new regulations that would make it
difficult for providers to participate in TRICARE.
Concurrently, one national organization expressed concern that
streamlining of accreditation requirements would negatively affect the
quality of care received by beneficiaries, warned about the failure of
accreditation agencies to ensure quality outcomes, and encouraged the
Department to prioritize not only access but quality. That organization
also suggested that TRICARE ensure public transparency and
accountability by publishing inspection results of mental health
facilities. The commenter also suggested that facilities with recent
serious incidents should be subject to frequent reviews and increased
reporting requirements around patient safety and quality measures. It
was also suggested that TRICARE enforce current staffing standards for
RTCs according to acuity and needs of patients, not only census. One
organization questioned the Department's intent to rely primarily on
national accreditation for authorization of RTCs and erroneously stated
that the Department requires on-site inspection before a participation
agreement is signed. They requested additional specific information and
clarification concerning what degree TRICARE would continue to impose
an additional layer of standards and processes and questioned how this
would be implemented. Another commenter acknowledged TRICARE's right to
conduct on-site surveys but indicated their hope was that on-site
surveys would be done only in extraordinary circumstances and that the
commitment to reliance on national accreditation would be sufficient in
virtually every case. Finally, some commenters strongly objected to the
requirement that participating institutional providers agree to permit
``full access to patients'' including interviewing patients during on-
site quality assurance or accounting audits be granted.
Response: We agree that previous, ``stand alone'' standards for
TRICARE certification are no longer necessary and standards must be
streamlined. We concur with multiple commenters who believe the
existing TRICARE certification standards now prove to be unnecessarily
restrictive. Instead, relying primarily on industry-accepted
accrediting bodies, including The Joint Commission and Commission on
Accreditation of Rehabilitation Facilities, will encourage
institutional provider participation in TRICARE thereby allowing
beneficiaries greater access to medically necessary services. In order
to avoid the necessity of updating the regulation every time a new
industry-accepted accrediting organization is recognized by TRICARE, we
have not included an itemized list of organizations in the regulation,
rather indicating that a full list of accrediting organizations
approved by the Director will be included in the TRICARE Policy Manual
and promulgated following publication of this final rule.
We strongly believe that relying primarily on accreditation by a
national accrediting body will not create an additional layer of
standards and processes, nor will it reduce the overall quality of care
beneficiaries receive. Over two decades ago, in the Final Rule:
``Civilian Health and Medical Program of the Uniformed Services
(CHAMPUS): Mental Health Services,'' as published in 60 FR 12419, March
7, 1995, standards were developed to address identified problems of
quality of care, fraud, and abuse in RTCs, SUDRFs, and PHPs at the
time. There are now a number of industry-accepted accrediting bodies
with mental health facility standards that meet or exceed the current
TRICARE-established standards. Streamlining procedures to qualify as a
TRICARE authorized institutional provider will not only increase access
to approved care, but also decrease the overall cost to both the
Department and institutional providers of certifying duplicative and
now unnecessary quality standards first implemented by the 1995 Final
Rule. With respect to eating disorders in particular, treatment
services rendered in TRICARE-authorized free-standing or hospital
facilities are covered as they are for other mental health and SUD
conditions. We believe this final rule will expand treatment options
for the treatment of eating disorders with the inclusion of IOPs as
well as the streamlining of requirements for institutional providers to
become TRICARE authorized providers.
We also appreciate the public comments we received regarding
quality of care and the need for ongoing oversight. TRICARE remains
committed to provision of high quality mental health and SUD services
and will continue to ensure high levels of quality care while expanding
access. While the

[[Page 61078]]

Department does intend to rely primarily on a facility's accreditation
and willingness to become a TRICARE participating providers, all
participating providers agree to grant the Department the right to
conduct quality assurance audits on a scheduled or unscheduled
(unannounced) basis as a condition of participation in TRICARE. To be
clear, while we require provider to agree to grant the Department with
the right to conduct audits, we do not intend to automatically conduct
an on-site inspection or audit of every provider as a condition of
participation. Further details regarding TRICARE's Quality and
Utilization Peer Review Organization Program, which is based on
specific statutory authority and follows many of the quality and
utilization review requirements and procedures in effect for the
Medicare Peer Review Organization, can be found in 32 CFR 199.15.
Further, 32 CFR 199.9 sets forth provisions for invoking administrative
remedies against providers in situations requiring administrative
action to enforce provisions of law, regulation, and policy in order to
ensure the quality of care for TRICARE beneficiaries. Given the past
abuses and the vulnerability of this patient population, full access to
patients is justified during on-site quality assurance and accounting
audits and helps to ensure transparency and accountability of all
parties. The Department has balanced the competing interests of
expanded access and provision of high quality care through the
provisions of this rule.
Comment: One commenter also made a number of specific
recommendations regarding the regulatory language in Sec. 199.6
applicable to mental health and SUD institutional providers. We
addressed the overarching mental health parity comments earlier. We
will now address the additional specific comments about the proposed
regulatory language.
Response: The commenter raised concerns with specific regulatory
language regarding RTCs, namely ``RTC is appropriate for patients whose
predominant symptom presentation is essentially stabilized, although
not resolved, and who have persistent dysfunction in major life
areas.'' The commenter indicated that the phrase ``essentially
stabilized'' is a subjective term with no clear meaning and Sec.
199.6(b)(4)(vii)(A)(1) should be revised. The Department would note
that this is the existing standard for RTCs and in practice, it has not
proven to be problematic but is rather geared to ensuring the
appropriate level of care as part of medically necessary and
appropriate care. This same commenter objected to the language in Sec.
199.6(b)(4)(vii)(A)(1) that differentiates residential treatment from
acute psychiatric care, partial hospitalization, a group home,
therapeutic schools, facilities that treat patients with a primary
diagnosis of substance use disorder or intellectual or developmental
disability. Similar objections were raised to Sec.
199.6(b)(4)(xiv)(A)(1) with respect to SUDRFs and included the
recommendation that subparagraph (i) should be clarified as referring
to a hospital/psychiatric hospital. The Department fully appreciates
that different states may use different terms in licenses institutional
providers. Regardless of the specific title of the license, as these
vary by state, the facility or distinct part of the facility and
license must be reviewed in order to determine the services that are
actually being offered and whether the facility meets the requirements
to be a TRICARE authorized RTC. These provisions are not new to the
TRICARE regulation and are necessary to distinguish an RTC from acute
psychiatric care, partial hospitalization, a professionally directed
living arrangement, educational program, SUDRF, or facility offering
long term, custodial care.
This commenter also recommended that the Department delete the
first sentence in Sec. 199.6(b)(4)(vii)(C)(2) and Sec.
199.6(b)(4)(xiv)(C)(2) requiring that services be provided to ``CHAMPUS
beneficiaries in the same manner'' that they are provided to other
patients, indicating that the second sentence, which prohibits
discrimination in admission practices, placement in special or separate
wings or rooms, or provisions of special or limited treatment, was
sufficient. Apart from stating that the second sentence in each of
these provisions was sufficient, no other rationale was provided as to
why the first sentence should be deleted. We believe these are
important requirements, and even if somewhat duplicative, the inclusion
of both provisions does no harm. Consequently, the Department has
decided to leave the language as originally proposed.
Comment: Also, several national organizations requested that
TRICARE allow providers 45 days rather than 30 to submit claims,
acknowledging that the intent of most providers is to submit claims
every 30 days, however, unforeseen delays do occur.
Response: In the case of continuous care, claims shall be submitted
at least every 30 days, as this is consistent with industry billing
standards and allows for efficiency and reduction of error in billing
practices. While the public comments were made in response to the
regulatory language regarding participation agreement requirements for
TRICARE mental health and SUD institutional providers, this is an
existing requirement that applies to all providers rendering continuous
care, not just mental health and SUD institutional providers. As the
specific provisions that were proposed in this rulemaking action were
merely reflective of overarching TRICARE claims requirements (see,
e.g., Sec. Sec. 199.4(b)(1)(i) and 199.7(e)(1)), it would not be
appropriate to revise the specific participation agreement provisions
for institutional mental health and SUD providers in a manner that is
inconsistent with other regulatory provisions that apply to the TRICARE
program as a whole. While the overarching TRICARE claims requirements
seek to lessen any potential adverse impact on a TRICARE beneficiary
that could result from a retroactive denial of care, we would also note
the existing provisions in 32 CFR 199.4(h) regarding payment and
liability for services and supplies retrospectively excluded by a Peer
Review Organization by reason of being not medically necessary, at an
inappropriate level, or other reason relative to reasonableness,
necessity or appropriateness. Additional information regarding waiver
of liability may be found in the TRICARE Policy Manual at Chapter 1,
Section 4.1. In summary, we believe the requirement to submit claims
every 30 days protects not only beneficiaries but also providers.
Comment: It was also requested that when providing cost data as
required by TRICARE, that an entity with multiple service lines and
treatment centers be allowed to submit a single consolidated audit of
the organization's financial statements, and financial controls to meet
this requirement.
Response: Both the existing and final regulation require
participating institutional providers to permit access to the financial
and organizational records of the provider and, when requested, to
furnish cost data certified by an independent accounting firm or other
agency authorized by the Director. Access to financial auditing/
reporting continues to be important to the program in evaluating the
quality and cost-effectiveness of care rendered by TRICARE-authorized
providers. Additionally, cost data and financial reports/audits are
utilized to calculate reimbursement rates in accordance with prescribed
reimbursement methodology for certain institutional providers. For

[[Page 61079]]

example, financial reports and audits would be essential for
verification of charge/cost data used in the establishment of RTC-
specific per diem rates. Entities are not prohibited from providing a
single, consolidated audit of their organization's financial statements
and controls to the extent that a consolidated audit provides the
specificity required for evaluating the separate entities under
consolidated reporting.
Comment: One commenter noted that the certification process
regarding RTCs should be on par with Medicaid certification.
Response: In general, under Medicaid, psychiatric residential
treatment facilities must be accredited by The Joint Commission or any
other accrediting organization with comparable standards recognized by
the State. Similarly, this final rule streamlines the approval process
for TRICARE authorized RTCs by relying principally on accreditation by
nationally-accepted accrediting organizations.
3. Provisions of the Final Rule. The final rule is consistent with
the proposed rule, and no substantive changes were made to provisions
regarding streamlined requirements for institutional mental health and
SUD providers to become TRICARE authorized providers.

V. Provisions of the Rule Regarding TRICARE Reimbursement Methodologies
for Newly Recognized Mental Health and SUD Intensive Outpatient
Programs and Opioid Treatment Programs

A. Intensive Outpatient Program Reimbursement

1. Provisions of the Proposed Rule. Under current regulatory
provisions [32 CFR 199.14(a)(2)(ix)(C)], the maximum per diem payment
amount for a full-day partial hospitalization program (minimum of six
hours) is 40 percent of the average per diem amount per case
established under the TRICARE mental health per diem reimbursement
system for both high and low volume psychiatric hospitals and units.
Likewise, PHPs less than six hours (with a minimum of three hours)
were paid a per diem rate at 75 percent of the rate for a full-day
program. In analysis of the reimbursement methodology to be used for
reimbursement of IOPs, it became apparent that the step-down in
intensity, frequency and duration of treatment designated as half-day
PHPs, were in fact, intensive outpatient services provided within a PHP
authorized setting. While there is some variability in the intensity,
frequency and duration of treatment under both programs (that is, less
than six hours per day with a minimum of three hours for half-day PHPs;
and two to five times per week, two to five hours per day for IOPs), it
appears that both the services rendered and the professional provider
categories responsible for providing the services are quite similar. As
a result of this observation/analysis, the IOP designation will be used
in lieu of half-day PHP for treatment of less than six hours per day--
with a minimum of two hours per day--rendered in a PHP authorized
setting. While the minimum hours have been reduced from three to two
hours per day for coverage/reimbursement, they are still within the
acceptable range for IOP services typically provided in a PHP. Since
intensive outpatient services can be provided in either a PHP or newly
authorized IOP setting, and IOP services are essentially the same as
half- day PHP services, it is only logical that IOP per diems be set at
75 percent of the full-day PHP per diem. This would be the case
regardless of whether the IOP services were provided in a PHP or IOP.
2. Analysis of Major Public Comments. Two public commenters
indicated that while the stated rationale for reimbursement of newly
recognized mental health and SUD IOPs and OTPs seems reasonable,
TRICARE must continue to reevaluate reimbursement over time in order to
achieve the goal of increasing access to care. The same commenters also
indicated that the all-inclusive per-diem payment rates appear to
provider a predictable payment methodology, which makes it more
possible for organizations to commit to providing services to TRICARE
beneficiaries. Another commenter indicated they would support
reasonable reimbursement rates if they at least meet or exceed the
Medicare level of reimbursement for comparable interventions and
patient service days, opining that reasonable reimbursement rates will
encourage institutional providers to offer these services if they can
do so without operating at a deficit. We appreciate these comments and
agree. Further, as discussed at greater length in the proposed rule, by
law, TRICARE reimbursement shall be determined, to the extent
practicable, in accordance with the same rules as apply to payments to
providers of services of the same type under Medicare. When Medicare
has no established reimbursement methodology (e.g. Medicare does not
reimburse OTPs or freestanding SUDRFs or PHPs that are not hospital
based or part of a Community Mental Health Clinic, while TRICARE does),
TRICARE must establish its own rates through proposed and final
rulemaking.
3. Provisions of the Final Rule. The final rule is consistent with
the proposed rule, and no substantive changes were made to provisions
regarding such IOP reimbursement.

B. Opioid Treatment Program Reimbursement and Cost-Sharing

1. Provisions of the Proposed Rule. As defined in this rule, OTPs
are outpatient settings for opioid treatment that use a therapeutic
maintenance drug for a drug addiction when medically or psychologically
necessary and appropriate for the medical care of a beneficiary
undergoing supervised treatment for a SUD. The program includes an
initial assessment, along with integrated psychosocial and medical
treatment and support services. Since OTPs are individually tailored
programs of medication therapy, separate reimbursement methodologies
are established based on the particular medication being administered
for treatment of the SUD. By far the most common medication used in
OTPs is methadone. Methadone care in OTPs includes initial medical
intake/assessment, urinalysis and drug dispensing and screening as part
of the bundled rate, as well as ongoing counseling services. Based on a
preliminary review of industry billing practices, the weekly bundled
per diem for administration of methadone will include a daily drug cost
of $3, along with a $15 per day cost for integrated psychosocial and
medical support services. The daily projected per diem costs ($18/day)
will be converted to a weekly per diem rate of $126 ($18/day x 7 days)
and billed once a week to TRICARE using the Healthcare Common Procedure
Coding System (HCPCS) code H0020, ``Alcohol and/or drug services;
methadone administration and/or service.'' The bundled per diem rate is
how Medicaid and other third-party payers typically reimburse for
methadone treatment in OTPs. The methadone rate for OTPs will be
updated annually by the Medicare update factor used for other mental
health care services rendered (i.e. the Inpatient Prospective Payment
System update factor) under TRICARE. The updated rates will be
effective October 1 of each year, and will be published annually on the
TRICARE Web site. Outpatient cost-sharing will be applied to a weekly
per diem, since the copayment amounts for Prime NADDs and ADFMs under
Extra and Standard

[[Page 61080]]

will be near, or in some cases, above the daily charge for OTPs,
essentially resulting in a non-benefit.
While the other two medications (buprenorphine and naltrexone) are
more likely to be prescribed and administered in an OBOT setting,
reimbursement methodologies for OTPs are being established for both
medications to allow OTPs the full range of medications currently
available for treatment of SUDs. Since the reimbursement of
buprenorphine and naltrexone administered in OTPs are not conducive to
the bundled per diem methodology due to variations in dosage and
frequency of the drug and the non-drug services (e.g., administration
fees and counseling services) will be reimbursed separately on a fee-
for-service basis. We recognize that Healthcare Common Procedure Coding
System (HCPCS) and Current Procedural Terminology (CPT) codes are
updated on a regular basis. The following referenced codes are current
as of the writing of this final rule. If necessary, updated codes will
be included in the TRICARE Policy Manual or TRICARE Reimbursement
Manual. In the case of Buprenorphine, OTPs will bill TRICARE using the
HCPCS code H0047, ``Alcohol and/or other drug use services, not
otherwise specified,'' for the medical intake/assessment, drug
dispensing and monitoring and counseling, along with HCPCS code J8499,
``Prescription drug, oral, non-chemotherapeutic, nos,'' for the
prescribed medication. OTPs will include the National Drug Code for
Buprenorphine, along with the dosage and acquisition cost on its claim.
Prevailing rates will be established for drug related services (e.g.,
drug monitoring and counseling services) billed under HCPCS code H0047,
while the drug itself will be reimbursed at 95 percent of the average
wholesale price. Outpatient cost-sharing will be applied on a per-visit
basis. The preliminary weekly cost estimate for Buprenorphine OTPs is
$115 per week, assuming that the patient is stabilized and twice a week
visits. This is based on an estimated drug cost of $10 per day and an
estimated non-drug cost of $22.50 per visit [(7 x $10) + (2 x $22.50) =
$115/week]. These amounts mentioned above are both preliminary and
estimates and are not intended to reflect final reimbursement rates.
Naltrexone, unlike methadone and buprenorphine, is not an agonist
or partial agonist, but an inhibitor designed to block the brain's
opiate receptors, diminishing the urges and cravings for alcohol,
heroin, and prescription painkillers such as oxycodone. Due to the
extreme cost of injectable naltrexone and the fact that it is only
administered once a month, the drug, its administration fee, and
ongoing counseling will be paid separately on a fee-for-service basis.
OTPs will bill TRICARE using HCPCS code H0047 for counseling and other
services. Prevailing rates will be established for drug related
services (e.g., drug monitoring and counseling services) billed under
HCPCS code H0047. The naltrexone injection will be billed using the
HCPCS code J2315 with the number of milligrams used, while its
administration fee will be billed using CPT code 96372. OTPs outpatient
cost-sharing will be applied on a per-visit basis, which in this case
would be once a month. The projected monthly amount for naltrexone is
$1,177 ($1,129 for the injectable drug (J2315) + $25 for the drug's
administration fee (CPT 96372) + $22.50 for other related services
(H0047) = $1,176.50). These amounts may be subject to change based on
health care market forces, but are not expected to change
significantly. The Director will have discretionary authority in
establishing the reimbursement methodologies for new drugs and
biologicals that may become available for the treatment of SUDs in
OTPs. The type of reimbursement (e.g., fee-for-service versus bundled
per diem payments) will be dependent in large part on the variability
of the dosage and frequency of the medication being administered.
2. Analysis of Major Public Comments. A number of commenters
indicated that they believed the rates proposed for OTPs' services are
near market rates and are acceptable. One commenter advised the
Department of Defense to evaluate existing state Medicaid reimbursement
models for the use of buprenorphine in OTPs, the most recent being
through the New York State Office of Alcoholism and Substance Abuse
services. The commenter felt that such references would provide
additional guidance to the Department in establishing appropriate
buprenorphine only rates for TRICARE beneficiaries.
One commenter felt that the proposed revisions assumed that
patients being treated with buprenorphine in OTPs, once stabilized,
would only visit OTPs twice a week. The commenter encouraged the
Department to consider an induction rate for patients being treated
with buprenorphine prior to stabilization requiring more than two
visits per week-in some cases requiring daily visits to OTPs to achieve
stabilization. Another commenter supported the rationale for a bundled
weekly rate, but expressed concern with the projected weekly per diem
price of $126, especially for New York State providers, would not be
financially sustainable.
Response: The review and analysis of Medicaid payment models were
instrumental in the establishment of separate reimbursement
methodologies based on the particular medication being administered for
treatment of the substance use disorder. It was apparent from this
initial analysis that separate fee-for-service reimbursement
methodologies needed to be established for frequency of the drug and
the non-drug services (e.g., administrative fees and counseling). As a
result, prevailing rates will be established on a fee-for-service basis
for all drug related services, while the drug itself will be reimbursed
at the lesser of billed charges or 95 percent of the average wholesale
price because Medicare has not yet established a reimbursement rate for
buprenorphine in the Part B Drug Medicare Average Sales Price file.
However, be assured that the Department will continue to review and
evaluate any innovative approaches [e.g., New York's Ambulatory Patient
Group (APG) payment methodology for SUD] for reimbursement of OTPs that
can effectively reduce costs and improve the quality of life for
individuals with opioid use disorder. To this end, the proposed
regulation included discretionary authority in establishing
reimbursement methodologies for new drugs and biologicals that may
become available for treatment of SUDs in OTPs.
This final rule does not set a limit of two visits per week for
medication assisted treatment, and in fact, all existing quantitative
limitations (regarding number of authorized visits, etc.) have been
removed from the regulation. A separate induction rate is not required
since buprenorphine treatment programs are reimbursed on a fee-for-
services basis; i.e., the drug and non-drug services (administration
fees and counseling services) will be reimbursed separately on a fee-
for-service basis and bundled for payment on a weekly basis. The
proposed rule merely included an example of how weekly services would
be bundled and the example included two visits to OTPs. The bundled
payments will vary depending on the dosage and frequency of the drug
being administered and frequency of associated counseling services. As
a result, the fee-for-service methodology will allow for additional
visits to OTPs during the induction phase of the patient's treatment.
We appreciate the commenter's support for the bundled weekly rate
for

[[Page 61081]]

methadone treatment programs. The amount projected in the proposed
rule, a weekly per diem rate of $126 for methadone treatment programs,
was based on a preliminary review of industry billing practices (i.e.,
bundled per diem rates that Medicaid and other third-party payers
typically reimburse for methadone treatment in OTPs). However, other
commenters did state the rates proposed for OTPs' services are near
market rates and are acceptable. We agree that local/regional variation
in costs for OTPs may occur, and therefore we will establish a national
weekly per-diem rate for methadone treatment which will be adjusted
utilizing the existing adjustment process appropriate to the treatment
setting (e.g., the CMAC locality-adjustment process for methadone
treatment provided in freestanding OTPs and the OPPS wage-index
adjustment formula for methadone treatment provided in hospital-based
OTPs). It is important to note separate reimbursement of buprenorphine
and naltrexone administered in OTPs will occur and will reflect the
variation in dosage and frequency of the drug and the non-drug
services. As a result, buprenorphine and naltrexone treatment programs
will be reimbursed on a fee-for-service basis, on the basis of the
CHAMPUS Maximum Allowable Charge (CMAC) methodology. A final national
methadone weekly per diem rate will be established prior to
implementation, which will reflect current bundled per diem rates that
Medicaid and other third-party payers typically reimburse for methadone
treatment in OTPs. The final reimbursement rates will be published in
the TRICARE Reimbursement Manual found here: http://manuals.tricare.osd.mil/.
3. Provisions of the Final Rule. The final rule is consistent with
the proposed rule, and no substantive changes were made to provisions
regarding opioid treatment program reimbursement and cost-sharing.

C. Removal of the Federal Register Publication of TRICARE Hospital-
Specific Rates and Fixed Daily Copayment Amounts

1. Provisions of the Proposed Rule. Under current regulatory
provisions [32 CFR 199.4(f)(3)(ii)(B) and 32 CFR
199.14(a)(2)(iv)(C)(4)], annually updated psychiatric hospital regional
per diems and fixed daily copayment amounts are to be published in the
Federal Register at approximately the start of each fiscal year. While
the initial intent of this regulatory requirement was to provide
widespread notice of changes to regional psychiatric hospital per diems
and fixed copayment mounts, its relevancy has been subsequently
overshadowed by the public's online accessibility to the TRICARE
manuals and reimbursement rates on the official Web site of the
Military Health System and the DHA (www.health.mil). As a result, the
public has ready online access to psychiatric hospital regional per
diems and fixed daily copayment amounts, as well as maximum rates for
mental health rates, to include freestanding psychiatric PHPs in the
TRICARE Reimbursement Manual or on the official Web site of the
Military Health System and the DHA (www.health.mil). Because of the
readily available online access to updated mental health rates and the
ongoing administrative burden of publishing annual notices to the
Federal Register, these regulatory requirements are removed and updates
to psychiatric hospital regional per diems and fixed copayment amounts
will be maintained on the Agency's official Web site. However,
psychiatric hospitals and units with hospital-specific rates will
continue to be notified individually of their rates due to
confidentiality restrictions. The new per diem rates for IOPs and
methadone OTPs will also be maintained and available to the public on
the official Web site of the Military Health System and the DHA
(www.health.mil).
2. Analysis of Major Public Comments. No public comments were
received relating to this section of the rule.
3. Provisions of the Final Rule. The final rule is consistent with
the proposed rule, and no substantive changes were made to provisions
regarding removal of the Federal Register publication of TRICARE
hospital-specific rates and fixed daily copayment amounts.

D. Additional Regulatory Revisions

1. Provisions of the Proposed Rule. There are a number of
additional proposed revisions that are more technical and
administrative in nature that we would like to highlight here to ensure
the public is made aware of these changes and their purpose. Within 32
CFR 199.2, the definition of ``adequate medical documentation, mental
health records'' is revised to eliminate specific reference to Joint
Commission standards and instead reference ``standards of an
accrediting organization approved by the Director'' consistent with the
changes in accreditation requirements as part of the streamlining of
TRICARE approval of institutional providers. The definition of ``mental
disorder'' has been revised to include SUD. The definition of
``Director'' has been revised to incorporate the Director of the
Defense Health Agency, consistent with DoD's current organizational
structure. Additionally, throughout the revisions, the term
``Director'' has been substituted for all other terms such as
``Director, CHAMPUS'' and ``Director, TRICARE Management Activity.'' A
definition of ``qualified mental health provider'' has been added for
easy reference (as it was previously discussed in 32 CFR 199.4 but not
specifically defined); and, the definition of ``Consultation'' has been
amended to include qualified mental health providers. Additionally, the
elimination of quantitative limitations has also necessitated a number
of revisions to other sections of the regulation that referenced these
limits, including 32 CFR 199.4(e)(2), 32 CFR 199.7(e)(2) and 32 CFR
199.15(a)(6). Also, 32 CFR 199.14(a)(2)(iv)(C)(2) clarifies that the
Medicare's Inpatient Prospective Payment System update factor is used
for TRICARE's mental health rates.
2. Analysis of Major Public Comments. One commenter recommended
that the definition of Case Management be revised to include the
following phrase ``including mental health and substance use disorder
needs'' and not just mental health needs. We have no objections to this
proposed change and have amended the definition accordingly. Another
commenter noted that the current definition of ``mental disorder'' in
Sec. 199.2 should be updated to reference the current version of the
Diagnostic and Statistical Manual (DSM) to avoid confusion and
correlate the definition with current practice definitions. We would
note that the proposed rule removed the referenced definition of
``mental disorder'', and replaced it with a definition of ``mental
disorder, to include substance use disorder.'' We would also note that
the newly proposed definition simply references the current edition of
the DSM so as to avoid the need to update the regulatory definition
every time the DSM is updated.
3. Provisions of the Final Rule. The final rule is consistent with
the proposed rule, with the addition of the above recommended change to
the definition of case management.

VI. Additional Comments

In addition to the four major areas of the proposed rule in which
we received comments, we received a number of general comments that
either do not apply to the major provision categories of the final rule
outlined above or apply

[[Page 61082]]

to multiple provision categories. Those comments are responded to as
follows:
Comment: Twenty eight commenters requested benefit coverage for IOP
and PHP stays for children under age thirteen.
Response: We thank those individuals who submitted these comments.
The exclusion of benefit coverage for the medically necessary treatment
to include IOP and PHP care for children under age thirteen was
unintentional and occurred when we combined the requirements for mental
health and SUD PHP and IOPs within Sec. 199.6. The Department does
acknowledge the States' need to impose specific mental health and SUD
facility licensure requirements and does note that this may impact IOP
and PHP stays for children under 13. However, we have amended the
language of the final rule to eliminate any age limitations from the
TRICARE definition of PHP and IOP care.
Comment: One commenter requested consistency with the Affordable
Care Act and provision of coverage for dependents until age twenty six.
Response: Regarding coverage of adult children, in accordance with
10 U.S.C. 1110b, the TRICARE Young Adult program currently provides
voluntary coverage for eligible adult children until age 26.
Comment: One commenter requested clarification regarding the scope
of CFR 42.2 laws and asked whether a mental health outpatient program
offering a single substance abuse class was still bound by these
regulations or if only the Health Insurance Portability and
Accountability Act laws apply.
Response: Although we appreciate this comment, it is outside the
scope of this rule and better addressed to the Department that
promulgated that regulation, namely the Department of Health and Human
Services.
Comment: One national organization commented that family therapy as
required in SUD partial hospitalization services could become
administratively burdensome for DoD and providers, as there are times
when family therapy is contra-indicated with the SUD population for
reasons such as trauma history and continued SUD in family members.
Response: DoD recognizes family therapy may be contraindicated for
some beneficiaries and in these cases, it is not required. We
appreciate the comment and have made additional revisions to Sec.
199.4(b)(9)(vi) to make it clear that the decision as to whether family
therapy is contraindicated for a specific patient may be made at the
facility vice Director, Defense Health Agency level. If family therapy
is clinically contraindicated, this should be noted and followed in the
treatment plan.
Comment: Another commenter requested the allowance of electronic
and video connections specifically for the provision of family therapy.
Response: We appreciate this suggestion and TRICARE supports the
use of interactive audio/video connections between TRICARE certified
providers and beneficiaries to provide clinical consultation and
office-visits when appropriate and medically necessary. Geographically
distant family therapy for children and adolescents in residential
treatment centers is allowed where family members are distally
separated from their children and the appointment takes place in
accordance with existing TRICARE telemedicine and telemental health
requirements as reflected in the TRICARE Policy Manual (Chapter 7,
Section 22.1).
Comment: Another national organization requested the inclusion of
long-acting injectable mental health and SUD medications as TRICARE
pharmacy benefits.
Response: The TRICARE Pharmacy Program, codified at 10 U.S.C. 1074g
and implemented via federal regulations at 32 CFR 199.21, provides
TRICARE beneficiaries with access to a wide range of pharmaceutical
agents, including self-administered and self-injectable medications.
Alternatively, medications that are administered by a physician or
other TRICARE authorized provider, including those drugs that are
administered as an integral part of a procedure, are reimbursed under
the TRICARE medical benefit program. Through these two complimentary
programs, TRICARE beneficiaries have access to medically necessary
prescription drugs, including long-acting injectable mental health and
SUD medications.
Comment: One commenter indicated that the proposed rule does not
address telehealth service delivery but acknowledged appreciation for
the Department's efforts to expand its use within a complicated
framework of federal and state laws. The commenter went on to indicate
that the regulation is not the place to address the details, but
including telehealth services in the list of covered services under
various benefits could be helpful as indicators of where additional
guidance is necessary. Another organization requested inclusion of a
patient's home or designated location as an originating site for the
receipt of telemedicine in the final rule language with regard to
mental health and SUD services.
Response: We appreciate the comments and agree that the regulation
is not the place to address the details of telemedicine. Further, the
Department views telehealth, or telemedicine, as a method of delivery
of medically necessary and appropriate care as opposed to a separate
type of care altogether. The use of interactive audio/video technology
is supported and allowed under existing TRICARE regulations and its use
is delineated in the TRICARE Policy Manual. The Department is actively
examining current policy regarding provision of telemedicine and
telehealth, and any changes will be addressed in subsequent policy
manual revisions.
Comment: One national organization requested streamlining of the
preauthorization process for patient admission. The organization also
requested clarification of the professional services of the attending
physicians.
Response: While we appreciate these comments, we believe they
address sub-regulatory issues and processes as opposed to any
regulatory approach proposed to be adopted by TRICARE. We are pleased
that the preauthorization process is supported and plan to continue
monitoring this process for any difficulties. Facilities and
beneficiaries with case-specific questions should work with the
regional managed care support contractor. While we are uncertain what
type of clarification is requested regarding the professional services
of attending physicians, we imagine these comments relate to
reimbursement of those services. Professional mental health services
are specifically addressed in both the existing, as well as, proposed
language under Sec. 199.4 for mental health and SUD institutional
benefits and indicates that these services are billed separately only
when rendered by an attending, TRICARE authorized mental health
professional who is not an employee or, or under contract with, the
applicable institutional provider for purposes of providing clinical
patient care.
Comment: Several commenters specifically emphasized the importance
of mental health SUD treatment for pediatric and adolescent patients.
Some of these comments included emphasis on the integration of mental
health and primary care where it makes sense and is feasible. Others
encouraged DoD to continue exploring how to better meet the needs of
military children. One national organization commented that the service
continuum should include prevention, early identification, and
comprehensive treatment services ranging from high fidelity wraparound

[[Page 61083]]

services to individual and family therapy and medication management.
Another commenter noted that TRICARE needs to fully fund WRAP-around
therapies for dependents, and noted that these services should be a
treatment step before an RTC as well as considered as a transitional
service whenever a child is discharged from an RTC. Similarly, another
national organization encouraged TRICARE to continue to invest in its
infrastructure for community-based services, reserving residential care
for only its most extreme cases.
Response: The provision of appropriate health care and overall
physical and mental well-being of military families and beneficiaries
is one of the highest priorities of the Department. We strongly believe
these changes will allow a comprehensive array of mental health
services for all beneficiaries including children and adolescents,
while maintaining quality standards. The Department agrees that care
should be based on a continuum of services according to the needs of
the individual. Within the MHS, the continuum of services begins with
the medical treatment facility or purchased care physicians,
pediatricians, nurses, and staff members who identify mental health
needs and primary care managers provide direct or purchased care
referrals for comprehensive treatment of beneficiaries. The final rule
addresses the way that services for children and adolescents are
delivered, through many levels of care according to the severity of
condition, with the goal of maintaining the child or youth in his or
her family or community where possible. Currently, TRICARE provides
family, individual, group therapy, and medication management in diverse
settings such as partial hospitalization, intensive outpatient,
residential treatment centers, inpatient mental health and SUD
treatment for children and adolescents. Further, managed care support
contractors provide case management for comprehensive treatment with
chronic and complex cases. While the full ``wraparound services'' model
for children in many cases includes educational and non-clinical
services that are beyond the scope of TRICARE coverage, this final rule
seeks to increase access to medically necessary clinical care in all
communities where military beneficiaries reside.
While not specifically addressed in this final rule, the Department
appreciates the comment regarding exploration of the use of behavioral
health integration programs and generally supports these concepts.
Comment: One commenter requested clarification on the determination
of medical necessity and offered to share their guidelines with the
Department as they found that a strong utilization review process based
on the latest science to be essential to ensure appropriate and timely
care.
Response: We appreciate the comment. The term medically or
psychologically necessary is defined at 199.2. Further, 32 CFR 199.15
establishes the rules and procedures for the TRICARE Quality and
Utilization Review Peer Review Organization program.
Comment: One commenter stated that qualified case managers should
not be required to have a minimum of two years' case management
experience before serving TRICARE beneficiaries.
Response: We appreciate this comment, and the ``Case Manager''
definition has been removed at Sec. 199.2 entirely as it is largely
unnecessary and industry now has a wide variety of accepted
qualifications for individuals to perform as case managers.
Comment: One commenter requested that TRICARE expand to cover
disabled veterans, and another commenter suggested that veterans should
be allowed to utilize TRICARE.
Response: TRICARE entitlement is established by statute and outside
of the scope of this rule. Similarly, compensation for and care and
treatment of Service-connected disabilities by the Department of
Veterans Affairs is governed by title 38, United States Code. The
Department of Veterans Affairs is the principal healthcare system to
address the healthcare needs of veterans with a Service-connected
disability. Veterans who are also entitled to TRICARE may elect which
benefit they are utilizing for a given episode of care.
Comment: One commenter suggested revising the referral process to
include Licensed Professional Counselors (LPCs) and LCAS (Licensed
Clinical Addiction Specialists (LCASs) with the ability to accept non-
primary care provider referred claims. Another commenter submitted an
inquiry regarding TRICARE authorization for mental health counselors.
Two commenters noted that the proposed rule failed to recognize SUD
professionals, including Advanced Alcohol Drug Counselors, that are
credentialed by a recognized body (e.g., the International
Certification and Reciprocity Consortium (IR&RC)). One of these two
commenters also recommended that a specific clause be added to the
regulation to recognize the acceptability of an Advanced Register Nurse
Practitioner in collaboration with a psychiatrist, as an acceptable
treatment provider in inpatient settings.
Response: As mentioned under the analysis of major public comments
under section III.C. above, TRICARE appreciates the contributions of
peer counselors, and other non-medical individuals who desire to
provide SUD and mental health services to beneficiaries as well as the
skills and professional experience of the various substance use
disorder and mental health providers in the field. We appreciate these
comments but consider them beyond the scope of this rule as we did not
propose any changes to the existing regulatory requirements for
individual professional providers of care. For a further discussion on
mental health counselors in particular, we would direct the public to
the TRICARE Certified Mental Health Counselor final rule published in
the Federal Register on July 17, 2014. With respect to the specific
comment about Advanced Registered Nurse Practitioners, we are uncertain
what is specifically being requested but would note that all mental
health services must be provided by TRICARE authorized individual
professional providers of mental health services. TRICARE specifically
recognized certified psychiatric nurse specialists (CPNS). The TRICARE
Policy Manual provides additional details, including a list of American
Nurses Credentialing Center certifications that meet TRICARE
requirements.
Comment: One commenter requested the addition of mobile crisis
stabilization services and other mental health care safety nets under
the provisions of TRICARE because outcomes and econometric analysis
shows their effectiveness in reducing the need for inpatient
hospitalization.
Response: We appreciate these comments, but they are beyond the
scope of this rule. Mobile crisis services are currently provided as
part of covered services for many institutional providers, and these
services do not warrant the creation of a new, stand-alone provider
type under TRICARE. However, we have reviewed all recommendations
provided and will consider them in the development of future policy.
Comment: One commenter requested that TRICARE provide coverage of
neurofeedback therapy.
Response: While this comment falls outside the scope of this rule,
we would note that TRICARE covers proven care as determined by the
hierarchy of reliable evidence in 32 CFR 199.14(g)(15). TRICARE
periodically reviews the available reliable evidence to determine
whether a given treatment

[[Page 61084]]

or procedure meets the criteria to be considered proven safe and
effective. In the event we find sufficient reliable evidence to
determine a given procedure is proven, the TRICARE Policy Manual is
updated.
Comment: One commenter expressed concern regarding ``the
reclassification of the electric shock machine.''
Response: The classification of medical devices is outside the
purview of the Department. We are uncertain regarding the specific type
of therapy the commenter is referring to, but we know that aversion
therapy is currently excluded, and will continue to be excluded, from
coverage. Specifically, the programmed use of physical measures, such
as electric shock, alcohol, or other drugs as negative reinforcement
(aversion therapy) is not a covered benefit, even if recommended by a
physician. If by ``electric shock machine'' the commenter is referring
to electroconvulsive therapy (ECT), the use of ECT as an evidence-based
treatment for the treatment of major depressive disorder remains a
covered benefit under TRICARE.
Comment: One national organization requested the Department
consider recognizing residential/transition brain injury treatment
programs as TRICARE authorized providers as either residential
treatment centers or Other Special Institutional Providers. That
organization also proposed an expansion of the definition of IOP to
include rehabilitation programs that provide services to Service
members and veterans with brain injury. Finally, the commenter also
recommended the Department consider extending TRICARE coverage for
cognitive rehabilitation therapy (CRT).
Response: We appreciate these comments. TRICARE does not normally
engage in agency rule-making for specific interventions, such as
Cognitive Rehabilitation Therapy (CRT). CRT, as billed on a residential
or IOP basis, has not been established as safe and effective and
therefore does not currently meet regulatory requirements (32 CFR, Part
199.4(g)(15)(i)) and is excluded from coverage. However, we would note
that TRICARE covers medically necessary and appropriate care, including
rehabilitative services, as provided by TRICARE-authorized physicians,
psychologists, physical therapists, occupational therapists, and speech
therapists, as well as recognized institutional providers. While
residential and transition brain injury programs are not currently
recognized as a separate category of institutional providers, with
respect to CRT, the Department does provide TRICARE coverage for
interventions when provided as part of otherwise covered occupational
therapy, physical therapy, and speech and language pathology services.
As medicine is ever evolving, the Department will continue to monitor
medical research and advances in this area for future revisions to the
TRICARE program. Further, in conjunction with the CDC, NIH, and VA, the
Department continues to collaborate on the development and improvement
of traumatic brain injury (TBI) related diagnostic tools and
therapeutic interventions that will allow for improved rehabilitation
and reintegration of military and civilian TBI survivors.

VII. Summary of Regulatory Modifications

Overall, the final rule is consistent with the proposed rule.
Several important changes are noted, in that we have amended the final
rule to: Remove the definition of ``Case Manager'' from Sec. 199.2;
remove the parenthetical reference to utilization and quality review of
mental health services in Sec. 199.4(a)(11) and remove and reserve
Sec. 199.4(a)(12) regarding utilization and quality review
specifically for inpatient mental health and partial hospitalization;
ensure medically necessary treatment coverage for dependents under age
thirteen for IOP and PHP care; clarify in Sec. 199.4(b)(9)(vi) that
while family therapy is a required component of PHP services, an
exception may be made when the Clinical Director, or designee,
determines that family therapy is clinically contraindicated for a
particular patient; and, remove the 30 percent capacity and full
operational status for a period of at least 6 months requirements for
TRICARE authorization of OTPs, IOPs, RTCs, PHPs, and SUDRFs.

VIII. Regulatory Procedures

Executive Order 12866, ``Regulatory Planning and Review'' and Executive
Order 13563, ``Improving Regulation and Regulatory Review''

Executive Orders 13563 and 12866 direct agencies to assess all
costs and benefits of available regulatory alternatives and, if
regulation is necessary, to select regulatory approaches that maximize
net benefits (including potential economic, environmental, public
health and safety effects, distribute impacts, and equity). Executive
Order 13563 emphasizes the importance of quantifying both costs and
benefits, of reducing costs, of harmonizing rules, and of promoting
flexibility. Subsequently, the Department completed an Independent
Government Cost Estimate and the results are referenced in C. Cost and
Benefits. This rule has been designated ``significant regulatory
action,'' although not economically significant, under section 3(f) of
Executive Order 12866. Accordingly, this final rule has been reviewed
by the Office of Management and Budget (OMB).

Congressional Review Act, 5 U.S.C. 804(2)

Under the Congressional Review Act, a major rule may not take
effect until at least 60 days after submission to Congress of a report
regarding the rule. A major rule is one that would have an annual
effect on the economy of $100 million or more or have certain other
impacts. This final rule is not a major rule under the Congressional
Review Act.

Public Law 96-354, ``Regulatory Flexibility Act'' (RFA), (5 U.S.C. 601)

The Regulatory Flexibility Act requires that each Federal agency
analyze options for regulatory relief of small businesses if a rule has
a significant impact on a substantial number of small entities. For
purposes of the RFA, small entities include small businesses, nonprofit
organizations, and small governmental jurisdictions. This final rule is
not an economically significant regulatory action, and it will not have
a significant impact on a substantial number of small entities.
Therefore, this final rule is not subject to the requirements of the
RFA.

Public Law 104-4, Sec. 202, ``Unfunded Mandates Reform Act''

Section 202 of the Unfunded Mandates Reform Act of 1995 also
requires that agencies assess anticipated costs and benefits before
issuing any rule whose mandates require spending in any one year of
$100 million in 1995 dollars, updated annually for inflation. That
threshold level is currently approximately $140 million. This rule will
not mandate any requirements for state, local, or tribal governments or
the private sector.

Public Law 96-511, ``Paperwork Reduction Act'' (44 U.S.C. Chapter 35)

This rulemaking does not contain a ``collection of information''
requirement, and will not impose additional information collection
requirements on the public under Public Law 96-511, ``Paperwork
Reduction Act'' (44 U.S.C. chapter 35).

[[Page 61085]]

Executive Order 13132, ``Federalism''

This final rule has been examined for its impact under E.O. 13132,
and it does not contain policies that have federalism implications that
would have substantial direct effects on the States, on the
relationship between the national Government and the States, or on the
distribution of powers and responsibilities among the various levels of
Government. Therefore, consultation with State and local officials is
not required.

List of Subjects in 32 CFR Part 199

Claims, Dental health, Health care, Health insurance, Individuals
with disabilities, Mental health, Mental health parity, Military
personnel, Substance use disorder treatment.

For the reasons stated in the preamble, the Department of Defense
amends 32 CFR part 199 as set forth below:

PART 199--CIVILIAN HEALTH AND MEDICAL PROGRAM OF THE UNIFORMED
SERVICES (CHAMPUS)

0
1. The authority citation for part 199 continues to read as follows:

Authority: 5 U.S.C. 301; 10 U.S.C. chapter 55.


0
2. Section 199.2(b) is amended by:
0
a. Revising the definitions of ``Adequate medical documentation, mental
health records'' and ``Case management'';
0
b. Removing the definition of ``Case managers'';
0
c. Revising the definitions of ``Consultation'' and ``Director'';
0
d. Adding definitions for ``Intensive outpatient program (IOP)'' and
``Medication assisted treatment (MAT)'' in alphabetical order;
0
e. Removing the definition of ``Mental disorder'';
0
f. Adding definitions for ``Mental disorder, to include substance use
disorder'', ``Office- based opioid treatment'' and ``Opioid Treatment
Program'' in alphabetical order;
0
g. Revising the definitions of ``Other special institutional
providers'' and ``Partial hospitalization'';
0
h. Adding a definition for ``Qualified mental health provider'' in
alphabetical order;
0
i. Revising the definition of ``Residential treatment center (RTC)'';
0
j. Adding a definition for ``Substance use disorder rehabilitation
facility (SUDRF)'' in alphabetical order; and
0
k. Revising the definition of ``Treatment plan''.
The revisions and additions read as follows:


Sec. 199.2 Definitions.

* * * * *
(b) * * *
Adequate medical documentation, mental health records. Adequate
medical documentation provides the means for measuring the type,
frequency, and duration of active treatment mechanisms employed and
progress under the treatment plan. Under CHAMPUS, it is required that
adequate and sufficient clinical records be kept by the provider to
substantiate that specific care was actually and appropriately
furnished, was medically or psychologically necessary (as defined by
this part), and to identify the individual(s) who provided the care.
Each service provided or billed must be documented in the records. In
determining whether medical records are adequate, the records will be
reviewed under the generally acceptable standards (e.g., the standards
of an accrediting organization approved by the Director, and the
provider's state or local licensing requirements) and other
requirements specified by this part. The psychiatric and psychological
evaluations, physician orders, the treatment plan, integrated progress
notes (and physician progress notes if separate from the integrated
progress notes), and the discharge summary are the more critical
elements of the mental health record. However, nursing and staff notes,
no matter how complete, are not a substitute for the documentation of
services by the individual professional provider who furnished
treatment to the beneficiary. In general, the documentation
requirements of a professional provider are not less in the outpatient
setting than the inpatient setting. Furthermore, even though a hospital
that provides psychiatric care may be accredited under The Joint
Commission (TJC) manual for hospitals rather than the behavioral health
standards manual, the critical elements of the mental health record
listed above are required for CHAMPUS claims.
* * * * *
Case management. Case management is a collaborative process which
assesses, plans, implements, coordinates, monitors, and evaluates the
options and services required to meet an individual's health needs,
including mental health and substance use disorder needs, using
communication and available resources to promote quality, cost
effective outcomes.
* * * * *
Consultation. A deliberation with a specialist physician, dentist,
or qualified mental health provider requested by the attending
physician primarily responsible for the medical care of the patient,
with respect to the diagnosis or treatment in any particular case. A
consulting physician or dentist or qualified mental health provider may
perform a limited examination of a given system or one requiring a
complete diagnostic history and examination. To qualify as a
consultation, a written report to the attending physician of the
findings of the consultant is required.

Note: Staff consultations required by rules and regulations of
the medical staff of a hospital or other institutional provider do
not qualify as consultation.

* * * * *
Director. The Director of the Defense Health Agency, Director,
TRICARE Management Activity, or Director, Office of CHAMPUS. Any
references to the Director, Office of CHAMPUS, or OCHAMPUS, or TRICARE
Management Activity, shall mean the Director, Defense Health Agency
(DHA). Any reference to Director shall also include any person
designated by the Director to carry out a particular authority. In
addition, any authority of the Director may be exercised by the
Assistant Secretary of Defense (Health Affairs).
* * * * *
Intensive outpatient program (IOP). A treatment setting capable of
providing an organized day or evening program that includes assessment,
treatment, case management and rehabilitation for individuals not
requiring 24-hour care for mental health disorders, to include
substance use disorders, as appropriate for the individual patient. The
program structure is regularly scheduled, individualized and shares
monitoring and support with the patient's family and support system.
* * * * *
Medication assisted treatment (MAT). MAT for diagnosed opioid use
disorder is a holistic modality for recovery and treatment that employs
evidence-based therapy, including psychosocial treatments and
psychopharmacology, and FDA-approved medications as indicated for the
management of withdrawal symptoms and maintenance.
* * * * *
Mental disorder, to include substance use disorder. For purposes of
the payment of CHAMPUS benefits, a mental disorder is a nervous or
mental condition that involves a clinically significant behavioral or
psychological syndrome or pattern that is associated with a painful
symptom, such as distress, and that impairs a patient's ability to
function in one or more major

[[Page 61086]]

life activities. A substance use disorder is a mental condition that
involves a maladaptive pattern of substance use leading to clinically
significant impairment or distress; impaired control over substance
use; social impairment; and risky use of a substance(s). Additionally,
the mental disorder must be one of those conditions listed in the
current edition of the Diagnostic and Statistical Manual of Mental
Disorders. ``Conditions Not Attributable to a Mental Disorder,'' or V
codes, are not considered diagnosable mental disorders. Co-occurring
mental and substance use disorders are common and assessment should
proceed as soon as it is possible to distinguish the substance related
symptoms from other independent conditions.
* * * * *
Office-based opioid treatment. TRICARE authorized providers acting
within the scope of their licensure or certification to prescribe
outpatient supplies of the medication to assist in withdrawal
management (detoxification) and/or maintenance of opioid use disorder,
as regulated by 42 CFR part 8, addressing office-based opioid treatment
(OBOT).
* * * * *
Opioid Treatment Program. Opioid Treatment Programs (OTPs) are
service settings for opioid treatment, either free standing or hospital
based, that adhere to the Department of Health and Human Services'
regulations at 42 CFR part 8 and use medications indicated and approved
by the Food and Drug Administration. Treatment in OTPs provides a
comprehensive, individually tailored program of medication therapy
integrated with psychosocial and medical treatment and support services
that address factors affecting each patient, as certified by the Center
for Substance Abuse Treatment (CSAT) of the Department of Health and
Human Services' Substance Abuse and Mental Health Services
Administration. Treatment in OTPs can include management of withdrawal
symptoms (detoxification) from opioids and medically supervised
withdrawal from maintenance medications. Patients receiving care for
substance use and co-occurring disorders care can be referred to, or
otherwise concurrently enrolled in, OTPs.
* * * * *
Other special institutional providers. Certain specialized medical
treatment facilities, either inpatient or outpatient, other than those
specifically defined, that provide courses of treatment prescribed by a
doctor of medicine or osteopathy; when the patient is under the
supervision of a doctor of medicine or osteopathy during the entire
course of the inpatient admission or the outpatient treatment; when the
type and level of care and services rendered by the institution are
otherwise authorized in this part; when the facility meets all
licensing or other certification requirements that are extant in the
jurisdiction in which the facility is located geographically; which is
accredited by the Joint Commission or other accrediting organization
approved by the Director if an appropriate accreditation program for
the given type of facility is available; and which is not a nursing
home, intermediate facility, halfway house, home for the aged, or other
institution of similar purpose.
* * * * *
Partial hospitalization. A treatment setting capable of providing
an interdisciplinary program of medically monitored therapeutic
services, to include management of withdrawal symptoms, as medically
indicated. Services may include day, evening, night and weekend
treatment programs which employ an integrated, comprehensive and
complementary schedule of recognized treatment approaches. Partial
hospitalization is a time-limited, ambulatory, active treatment program
that offers therapeutically intensive, coordinated, and structured
clinical services within a stable therapeutic environment. Partial
hospitalization is an appropriate setting for crisis stabilization,
treatment of partially stabilized mental disorders, to include
substance disorders, and a transition from an inpatient program when
medically necessary.
* * * * *
Qualified mental health provider. Psychiatrists or other
physicians; clinical psychologists, certified psychiatric nurse
specialists, certified clinical social workers, certified marriage and
family therapists, TRICARE certified mental health counselors, pastoral
counselors under a physician's supervision, and supervised mental
health counselors under a physician's supervision.
* * * * *
Residential treatment center (RTC). A facility (or distinct part of
a facility) which meets the criteria in Sec. 199.6(b)(4)(vii).
* * * * *
Substance use disorder rehabilitation facility (SUDRF). A facility
or a distinct part of a facility that meets the criteria in Sec.
199.6(b)(4)(xiv).
* * * * *
Treatment plan. A detailed description of the medical care being
rendered or expected to be rendered a CHAMPUS beneficiary seeking
approval for inpatient and other benefits for which preauthorization is
required as set forth in Sec. 199.4(b). Medical care described in the
plan must meet the requirements of medical and psychological necessity.
A treatment plan must include, at a minimum, a diagnosis (either
current International Statistical Classification of Diseases and
Related Health Problems (ICD) or current Diagnostic and Statistical
Manual of Mental Disorders (DSM)); detailed reports of prior treatment,
medical history, family history, social history, and physical
examination; diagnostic test results; consultant's reports (if any);
proposed treatment by type (such as surgical, medical, and
psychiatric); a description of who is or will be providing treatment
(by discipline or specialty); anticipated frequency, medications, and
specific goals of treatment; type of inpatient facility required and
why (including length of time the related inpatient stay will be
required); and prognosis. If the treatment plan involves the transfer
of a CHAMPUS patient from a hospital or another inpatient facility,
medical records related to that inpatient stay also are required as a
part of the treatment plan documentation.
* * * * *

0
3. Section 199.4 is amended by:
0
a. Revising paragraphs (a)(1)(i) and (a)(11);
0
b. Removing and reserving paragraph (a)(12);
0
c. Adding paragraphs (a)(14), (b)(1)(vi), (b)(2)(xix) and (xx), and
(b)(3)(xvi) and (xvii);
0
d. Removing paragraphs (b)(4)(viii) and (ix);
0
e. Removing and reserving paragraphs (b)(6)(iii) and (iv);
0
f. Revising paragraph (b)(7) introductory text;
0
g. Revising paragraphs (b)(8), (9), and (10);
0
h. Adding paragraph (b)(11);
0
i. Revising paragraph (c)(3)(ix);
0
j. Removing and reserving paragraphs (e)(4) and (e)(7);
0
k. Revising paragraph (e)(8)(ii)(A);
0
l. Adding paragraph (e)(8)(ii)(D);
0
m. Removing and reserving paragraph (e)(8)(iv)(P);
0
n. Revising paragraphs (e)(8)(iv)(Q) and (R);
0
o. Revising paragraph (e)(11) introductory text
0
p. Revising paragraph (e)(13)(i)(B);
0
q. Removing paragraph (e)(30)(iii);
0
r. Revising paragraph (f)(2)(ii) introductory text;
0
s. Removing paragraph (f)(2)(ii)(D);

[[Page 61087]]

0
t. Removing and reserving paragraph (f)(2)(v);
0
u. Revising paragraph (f)(3)(ii);
0
v. Removing paragraph (f)(3)(iv);
0
w. Revising paragraphs (g)(1) and (g)(29);
0
x. Removing and reserving paragraph (g)(72); and
0
y. Revising paragraph (g)(73).
The revisions and additions read as follows:


Sec. 199.4 Basic program benefits.

(a) * * *
(1)(i) Scope of benefits. Subject to all applicable definitions,
conditions, limitations, or exclusions specified in this part, the
CHAMPUS Basic Program will pay for medically or psychologically
necessary services and supplies required in the diagnosis and treatment
of illness or injury, including maternity care and well-baby care.
Benefits include specified medical services and supplies provided to
eligible beneficiaries from authorized civilian sources such as
hospitals, other authorized institutional providers, physicians, other
authorized individual professional providers, and professional
ambulance service, prescription drugs, authorized medical supplies, and
rental or purchase of durable medical equipment.
* * * * *
(11) Quality and Utilization Review Peer Review Organization
program. All benefits under the CHAMPUS program are subject to review
under the CHAMPUS Quality and Utilization Review Peer Review
Organization program pursuant to Sec 199.15.
* * * * *
(14) Confidentiality of substance use disorder treatment. Release
of any patient identifying information, including that required to
adjudicate a claim, must comply with the provisions of section 543 of
the Public Health Service Act, as amended, (42 U.S.C. 290dd-2), and
implementing regulations at 42 CFR part 2, which governs the release of
medical and other information from the records of patients undergoing
treatment of substance use disorder. If the patient refuses to
authorize the release of medical records which are, in the opinion of
the Director, Defense Health Agency, or a designee, necessary to
determine benefits on a claim for treatment of substance use disorder,
the claim will be denied.
(b) * * *
(1) * * *
(vi) Substance use disorder treatment exclusions. (A) The
programmed use of physical measures, such as electric shock, alcohol,
or other drugs as negative reinforcement (aversion therapy) is not
covered, even if recommended by a physician.
(B) Domiciliary settings. Domiciliary facilities generally referred
to as halfway or quarterway houses are not authorized providers and
charges for services provided by these facilities are not covered.
(2) * * *
(xix) Medication assisted treatment. Covered drugs and medicines
for the treatment of substance use disorder include the substitution of
a therapeutic drug, with addictive potential, for a drug addiction when
medically or psychologically necessary and appropriate medical care for
a beneficiary undergoing supervised treatment for a substance use
disorder.
(xx) Withdrawal management (detoxification). For a beneficiary
undergoing treatment for a substance use disorder, this includes
management of a patient's withdrawal symptoms (detoxification).
(3) * * *
(xvi) Medication assisted treatment. Covered drugs and medicines
for the treatment of substance use disorder include the substitution of
a therapeutic drug, with addictive potential, for a drug addiction when
medically or psychologically necessary and appropriate medical care for
a beneficiary undergoing supervised treatment for a substance use
disorder.
(xvii) Withdrawal management (detoxification). For a beneficiary
undergoing treatment for a substance use disorder, this includes
management of a patient's withdrawal symptoms (detoxification).
* * * * *
(7) Emergency inpatient hospital services. In the case of a medical
emergency, benefits can be extended for medically necessary inpatient
services and supplies provided to a beneficiary by a hospital,
including hospitals that do not meet CHAMPUS standards or comply with
the nondiscrimination requirements under title VI of the Civil Rights
Act and other nondiscrimination laws applicable to recipients of
federal financial assistance, or satisfy other conditions herein set
forth. In a medical emergency, medically necessary inpatient services
and supplies are those that are necessary to prevent the death or
serious impairment of the health of the patient, and that, because of
the threat to the life or health of the patient, necessitate, the use
of the most accessible hospital available and equipped to furnish such
services. Emergency services are covered when medically necessary for
the active medical treatment of the acute phases of substance
withdrawal (detoxification), for stabilization and for treatment of
medical complications for substance use disorder. The availability of
benefits depends upon the following three separate findings and
continues only as long as the emergency exists, as determined by
medical review. If the case qualified as an emergency at the time of
admission to an unauthorized institutional provider and the emergency
subsequently is determined no longer to exist, benefits will be
extended up through the date of notice to the beneficiary and provider
that CHAMPUS benefits no longer are payable in that hospital.
* * * * *
(8) Residential treatment for substance use disorder--(i) In
general. Rehabilitative care, to include withdrawal management
(detoxification), in an inpatient residential setting of an authorized
hospital or substance use disorder rehabilitative facility, whether
free-standing or hospital-based, is covered on a residential basis. The
medical necessity for the management of withdrawal symptoms must be
documented. Any withdrawal management (detoxification) services
provided by the substance use disorder rehabilitation facility must be
under general medical supervision.
(ii) Criteria for determining medical or psychological necessity of
residential treatment for substance use disorder. Residential treatment
for substance use disorder will be considered necessary only if all of
the following conditions are present:
(A) The patient has been diagnosed with a substance use disorder.
(B) The patient is experiencing withdrawal symptoms or potential
symptoms severe enough to require inpatient care and physician
management, or who have less severe symptoms that require 24-hour
inpatient monitoring or the patient's addiction-related symptoms, or
concomitant physical and emotional/behavioral problems reflect
persistent dysfunction in several major life areas.
(iii) Services and supplies. The following services and supplies
are included in the per diem rate approved for an authorized
residential treatment for substance use disorder.
(A) Room and board. Includes use of the residential treatment
program facilities such as food service (including special diets),
laundry services, supervised therapeutically constructed recreational
and social activities, and other general services as considered

[[Page 61088]]

appropriate by the Director, or a designee.
(B) Patient assessment. Includes the assessment of each individual
accepted by the facility, and must, at a minimum, consist of a physical
examination; psychiatric examination; psychological assessment;
assessment of physiological, biological and cognitive processes; case
management assessment; developmental assessment; family history and
assessment; social history and assessment; educational or vocational
history and assessment; environmental assessment; and recreational/
activities assessment. Assessments conducted within 30 days prior to
admission to a residential treatment program for substance use disorder
(SUD) may be used if approved and deemed adequate to permit treatment
planning by the residential treatment program for SUD.
(C) Psychological testing. Psychological testing is provided based
on medical and psychological necessity.
(D) Treatment services. All services, supplies, equipment and space
necessary to fulfill the requirements of each patient's individualized
diagnosis and treatment plan. All mental health services must be
provided by a TRICARE authorized individual professional provider of
mental health services. [Exception: Residential treatment programs that
employ individuals with master's or doctoral level degrees in a mental
health discipline who do not meet the licensure, certification, and
experience requirements for a qualified mental health provider but are
actively working toward licensure or certification may provide services
within the all-inclusive per diem rate, but such individuals must work
under the clinical supervision of a fully qualified mental health
provider employed by the facility.]
(iv) Case management required. The facility must provide case
management that helps to assure arrangement of community based support
services, referral of suspected child or elder abuse or domestic
violence to the appropriate state agencies, and effective after care
arrangements, at a minimum.
(v) Professional mental health benefits. Professional mental health
benefits are billed separately from the residential treatment program
per diem rate only when rendered by an attending, TRICARE authorized
mental health professional who is not an employee of, or under contract
with, the program for purposes of providing clinical patient care.
(vi) Non-mental health related medical services. Separate billing
will be allowed for otherwise covered non-mental health related
services.
(9) Psychiatric and substance use disorder partial hospitalization
services--(i) In general. Partial hospitalization services are those
services furnished by a TRICARE authorized partial hospitalization
program and authorized mental health providers for the active treatment
of a mental disorder. All services must follow a medical model and vest
patient care under the general direction of a licensed TRICARE
authorized physician employed by the partial hospitalization program to
ensure medication and physical needs of all the patients are
considered. The primary or attending provider must be a TRICARE
authorized mental health provider (see paragraph (c)(3)(ix) of this
section), operating within the scope of his/her license. These
categories include physicians, clinical psychologists, certified
psychiatric nurse specialists, clinical social workers, marriage and
family counselors, TRICARE certified mental health counselors, pastoral
counselors, and supervised mental health counselors. All categories
practice independently except pastoral counselors and supervised mental
health counselors who must practice under the supervision of TRICARE
authorized physicians. Partial hospitalization services and
interventions are provided at a high degree of intensity and
restrictiveness of care, with medical supervision and medication
management. Partial hospitalization services are covered as a basic
program benefit only if they are provided in accordance with paragraph
(b)(9) of this section. Such programs must enter into a participation
agreement with TRICARE; and be accredited and in substantial compliance
with the specified standards of an accreditation organization approved
by the Director.
(ii) Criteria for determining medical or psychological necessity of
psychiatric and SUD partial hospitalization services. Partial
hospitalization services will be considered necessary only if all of
the following conditions are present:
(A) The patient is suffering significant impairment from a mental
disorder (as defined in Sec. 199.2) which interferes with age
appropriate functioning or the patient is in need of rehabilitative
services for the management of withdrawal symptoms from alcohol,
sedative-hypnotics, opioids, or stimulants that require medically-
monitored ambulatory detoxification, with direct access to medical
services and clinically intensive programming of rehabilitative care
based on individual treatment plans.
(B) The patient is unable to maintain himself or herself in the
community, with appropriate support, at a sufficient level of
functioning to permit an adequate course of therapy exclusively on an
outpatient basis, to include outpatient treatment program, outpatient
office visits, or intensive outpatient services (but is able, with
appropriate support, to maintain a basic level of functioning to permit
partial hospitalization services and presents no substantial imminent
risk of harm to self or others). These patients require medical
support; however, they do not require a 24-hour medical environment.
(C) The patient is in need of crisis stabilization, acute symptom
reduction, treatment of partially stabilized mental health disorders,
or services as a transition from an inpatient program.
(D) The admission into the partial hospitalization program is based
on the development of an individualized diagnosis and treatment plan
expected to be effective for that patient and permit treatment at a
less intensive level.
(iii) Services and supplies. The following services and supplies
are included in the per diem rate approved for an authorized partial
hospitalization program:
(A) Board. Includes use of the partial hospital facilities such as
food service, supervised therapeutically constructed recreational and
social activities, and other general services as considered appropriate
by the Director, or a designee.
(B) Patient assessment. Includes the assessment of each individual
accepted by the facility, and must, at a minimum, consist of a physical
examination; psychiatric examination; psychological assessment;
assessment of physiological, biological and cognitive processes; case
management assessment; developmental assessment; family history and
assessment; social history and assessment; educational or vocational
history and assessment; environmental assessment; and recreational/
activities assessment. Assessments conducted within 30 days prior to
admission to a partial program may be used if approved and deemed
adequate to permit treatment planning by the partial hospital program.
(C) Psychological testing. Treatment services. All services,
supplies, equipment and space necessary to fulfill the requirements of
each patient's individualized diagnosis and treatment plan. All mental
health services must be provided by a TRICARE authorized individual
professional provider of

[[Page 61089]]

mental health services. [Exception: partial hospitalization programs
that employ individuals with master's or doctoral level degrees in a
mental health discipline who do not meet the licensure, certification,
and experience requirements for a qualified mental health provider but
are actively working toward licensure or certification, may provide
services within the all-inclusive per diem rate, but such individuals
must work under the clinical supervision of a fully qualified mental
health provider employed by the partial hospitalization program.]
(iv) Case management required. The facility must provide case
management that helps to assure the patient appropriate living
arrangements after treatment hours, transportation to and from the
facility, arrangement of community based support services, referral of
suspected child or elder abuse or domestic violence to the appropriate
state agencies, and effective after care arrangements, at a minimum.
(v) Educational services required. Programs treating children and
adolescents must ensure the provision of a state certified educational
component which assures that patients do not fall behind in educational
placement while receiving partial hospital treatment. CHAMPUS will not
fund the cost of educational services separately from the per diem
rate. The hours devoted to education do not count toward the
therapeutic intensive outpatient program or full day program.
(vi) Family therapy required. The facility must ensure the
provision of an active family therapy treatment component, which
assures that each patient and family participate at least weekly in
family therapy provided by the institution and rendered by a TRICARE
authorized individual professional provider of mental health services.
There is no acceptable substitute for family therapy. An exception to
this requirement may be granted on a case-by-case basis by the Clinical
Director, or designee, only if family therapy is clinically
contraindicated.
(vii) Professional mental health benefits. Professional mental
health benefits are billed separately from the partial hospitalization
per diem rate only when rendered by an attending, TRICARE authorized
mental health professional who is not an employee of, or under contract
with, the partial hospitalization program for purposes of providing
clinical patient care.
(viii) Non-mental health related medical services. Separate billing
will be allowed for otherwise covered, non-mental health related
medical services.
(10) Intensive psychiatric and substance use disorder outpatient
services--(i) In general. Intensive outpatient services are those
services furnished by a TRICARE authorized intensive outpatient program
and qualified mental health provider(s) for the active treatment of a
mental disorder, to include substance use disorder.
(ii) Criteria for determining medical or psychological necessity of
intensive outpatient services. In determining the medical or
psychological necessity of intensive outpatient services, the
evaluation conducted by the Director, or designee, shall consider the
appropriate level of care, based on the patient's clinical needs and
characteristics matched to a service's structure and intensity. In
addition to the criteria set for this paragraph (b)(10) of this
section, additional evaluation standards, consistent with such
criteria, may be adopted by the Director, or designee. Treatment in an
intensive outpatient setting shall not be considered necessary unless
the patient requires care that is more intensive than an outpatient
treatment program or outpatient office visits and less intensive than
inpatient psychiatric care or a partial hospital program. Intensive
outpatient services will be considered necessary only if the following
conditions are present:
(A) The patient is suffering significant impairment from a mental
disorder, to include a substance use disorder (as defined in Sec.
199.2), which interferes with age appropriate functioning. Patients
receiving a higher intensity of treatment may be experiencing moderate
to severe instability, exacerbation of severe/persistent disorder, or
dangerousness with some risk of confinement. Patients receiving a lower
intensity of treatment may be experiencing mild instability with
limited dangerousness and low risk for confinement.
(B) The patient is unable to maintain himself or herself in the
community, with appropriate support, at a sufficient level of
functioning to permit an adequate course of therapy exclusively in an
outpatient treatment program or an outpatient office basis (but is
able, with appropriate support, to maintain a basic level of
functioning to permit a level of intensive outpatient treatment and
presents no substantial imminent risk of harm to self or others).
(C) The patient is in need of stabilization, symptom reduction, and
prevention of relapse for chronic mental illness. The goal of
maintenance of his or her functioning within the community cannot be
met by outpatient office visits, but requires active treatment in a
stable, staff-supported environment;
(D) The admission into the intensive outpatient program is based on
the development of an individualized diagnosis and treatment plan
expected to be effective for that patient and permit treatment at a
less intensive level.
(iii) Services and supplies. The following services and supplies
are included in the per diem rate approved for an authorized intensive
outpatient program.
(A) Patient assessment. Includes the assessment of each individual
accepted by the facility.
(B) Treatment services. All services, supplies, equipment, and
space necessary to fulfill the requirements of each patient's
individualized diagnosis and treatment plan. All mental health services
must be provided by a TRICARE authorized individual qualified mental
health provider. [Exception: Intensive outpatient programs that employ
individuals with master's or doctoral level degrees in a mental health
discipline who do not meet the licensure, certification, and experience
requirements for a qualified mental health provider but are actively
working toward licensure or certification, may provide services within
the all-inclusive per diem rate but such individuals must work under
the clinical supervision of a fully qualified mental health provider
employed by the facility.]
(iv) Case management. When appropriate, and with the consent of the
person served, the facility should coordinate the care, treatment, or
services, including providing coordinated treatment with other
services.
(v) Professional mental health benefits. Professional mental health
benefits are billed separately from the intensive outpatient per diem
rate only when rendered by an attending, TRICARE authorized qualified
mental health provider who is not an employee of, or under contract
with, the program for purposes of providing clinical patient care.
(vi) Non-mental health related medical services. Separate billing
will be allowed for otherwise covered, non-mental health related
medical services.
(11) Opioid treatment programs--(i) In general. Outpatient
treatment and management of withdrawal symptoms for substance use
disorder provided at a TRICARE authorized opioid treatment program are
covered. If the patient is medically in need of management of
withdrawal symptoms, but does not

[[Page 61090]]

require the personnel or facilities of a general hospital setting,
services for management of withdrawal symptoms are covered. The medical
necessity for the management of withdrawal symptoms must be documented.
Any services to manage withdrawal symptoms provided by the opioid
treatment program must be under general medical supervision.
(ii) Criteria for determining medical or psychological necessity of
an opioid treatment program are set forth in 42 CFR part 8.
(iii) Services and supplies. The following services and supplies
are included in the reimbursement approved for an authorized opioid
treatment program.
(A) Patient assessment. Includes the assessment of each individual
accepted by the facility.
(B) Treatment services. All services, supplies, equipment, and
space necessary to fulfill the requirements of each patient's
individualized diagnosis and treatment plan. All mental health services
must be provided by a TRICARE authorized individual professional
provider of mental health services. [Exception: opioid treatment
programs that employ individuals with degrees in a mental health
discipline who do not meet the licensure, certification, and experience
requirements for a qualified mental health provider but work under the
clinical supervision of a fully qualified mental health provider
employed by the facility.]
(iv) Case management. Care, treatment, or services should be
coordinated among providers and between settings, independent of
whether they are provided directly by the organization or by an
organization or by an outside source, so that the individual's needs
are addressed in a seamless, synchronized, and timely manner.
(c) * * *
(3) * * *
(ix) Treatment of mental disorders, to include substance use
disorder. In order to qualify for CHAMPUS mental health benefits, the
patient must be diagnosed by a TRICARE authorized qualified mental
health professional practicing within the scope of his or her license
to be suffering from a mental disorder, as defined in Sec. 199.2
(A) Covered diagnostic and therapeutic services. CHAMPUS benefits
are payable for the following services when rendered in the diagnosis
or treatment of a covered mental disorder by a TRICARE authorized
qualified mental health provider practicing within the scope of his or
her license. Qualified mental health providers are: Psychiatrists or
other physicians; clinical psychologists, certified psychiatric nurse
specialists, certified clinical social workers, certified marriage and
family therapists, TRICARE certified mental health counselors, pastoral
counselors under a physician's supervision, and supervised mental
health counselors under a physician's supervision.
(1) Individual psychotherapy, adult or child. A covered individual
psychotherapy session is no more than 60 minutes in length. An
individual psychotherapy session of up to 120 minutes in length is
payable for crisis intervention.
(2) Group psychotherapy. A covered group psychotherapy session is
no more than 90 minutes in length.
(3) Family or conjoint psychotherapy. A covered family or conjoint
psychotherapy session is no more than 90 minutes in length. A family or
conjoint psychotherapy session of up to 180 minutes in length is
payable for crisis intervention.
(4) Psychoanalysis. Psychoanalysis is covered when provided by a
graduate or candidate of a psychoanalytic training institution
recognized by the American Psychoanalytic Association and when
preauthorized by the Director, or a designee.
(5) Psychological testing and assessment. Psychological testing and
assessment is covered when medically or psychologically necessary.
Psychological testing and assessment performed as part of an assessment
for academic placement are not covered.
(6) Administration of psychotropic drugs. When prescribed by an
authorized provider qualified by licensure to prescribe drugs.
(7) Electroconvulsive treatment. When provided in accordance with
guidelines issued by the Director.
(8) Collateral visits. Covered collateral visits are those that are
medically or psychologically necessary for the treatment of the
patient.
(9) Medication assisted treatment. Medication assisted treatment,
combining pharmacotherapy and holistic care, to include provision in
office-based opioid treatment by an authorized TRICARE provider, is
covered. The practice of an individual physician in office-based
treatment is regulated by the Department of Health and Human Services'
42 CFR 8.12, the Center for Substance Abuse Treatment (CSAT), and the
Drug Enforcement Administration (DEA), along with individual state and
local regulations.
(B) Therapeutic settings--(1) Outpatient psychotherapy. Outpatient
psychotherapy generally is covered for individual, family, conjoint,
collateral, and/or group sessions.
(2) Inpatient psychotherapy. Coverage of inpatient psychotherapy is
based on medical or psychological necessity for the services identified
in the patient's treatment plan.
(C) Covered ancillary therapies. Includes art, music, dance,
occupational, and other ancillary therapies, when included by the
attending provider in an approved inpatient, SUDRF, residential
treatment, partial hospital, or intensive outpatient program treatment
plan and under the clinical supervision of a qualified mental health
professional. These ancillary therapies are not separately reimbursed
professional services but are included within the institutional
reimbursement.
(D) Review of claims for treatment of mental disorder. The Director
shall establish and maintain procedures for review, including
professional review, of the services provided for the treatment of
mental disorders.
* * * * *
(e) * * *
(8) * * *
(ii) * * *
(A) For purposes of CHAMPUS, dental congenital anomalies such as
absent tooth buds or malocclusion specifically are excluded.
* * * * *
(D) Any procedures related to sex gender changes, except as
provided in paragraph (g)(29) of this section, are excluded.
* * * * *
(iv) * * *
(Q)) Penile implant procedure for psychological impotency or as
related to sex gender changes, as prohibited by section 1079 of title
10, United States Code.
(R) Insertion of prosthetic testicles as related to sex gender
changes, as prohibited by section 1079 of title 10, United States Code.
* * * * *
(11) Drug abuse. Under the Basic Program, benefits may be extended
for medically necessary prescription drugs required in the treatment of
an illness or injury or in connection with maternity care (refer to
paragraph (d) of this section). However, TRICARE benefits cannot be
authorized to support or maintain an existing or potential drug abuse
situation whether or not the drugs (under other circumstances) are
eligible for benefit consideration and whether or not obtained by legal
means. Drugs, including the substitution of a therapeutic drug with
addictive

[[Page 61091]]

potential for a drug of addiction, prescribed to beneficiaries
undergoing medically supervised treatment for a substance use disorder
as authorized under paragraphs (b) and (c) of this section are not
considered to be in support of, or to maintain, an existing or
potential drug abuse situation and are allowed. The Director may
prescribe appropriate policies to implement this prescription drug
benefit for those undergoing medically supervised treatment for a
substance use disorder.
* * * * *
(13) * * *
(i) * * *
(B) Home care is not suitable. Institutionalization of a child
because a parent (or parents) is unable to provide a safe and nurturing
environment due to a mental or substance use disorder, or because
someone in the home has a contagious disease, are examples of why
domiciliary care is being provided because the home setting is
unsuitable.
* * * * *
(f) * * *
(2) * * *
(ii) Inpatient cost-sharing. Dependents of members of the Uniformed
Services are responsible for the payment of the first $25 of the
allowable institutional costs incurred with each covered inpatient
admission to a hospital or other authorized institutional provider
(refer to Sec. 199.6, including inpatient admission to a residential
treatment center, substance use disorder rehabilitation facility
residential treatment program, or skilled nursing facility), or the
amount the beneficiary or sponsor would have been charged had the
inpatient care been provided in a Uniformed Service hospital, whichever
is greater.
Note: The Secretary of Defense (after consulting with the Secretary
of Health and Human Services and the Secretary of Transportation)
prescribes the fair charges for inpatient hospital care provided
through Uniformed Services medical facilities. This determination is
made each fiscal year.
* * * * *
(3) * * *
(ii) Inpatient cost-sharing. Inpatient admissions to a hospital or
other authorized institutional provider (refer to Sec. 199.6,
including inpatient admission to a residential treatment center,
substance use disorder rehabilitation facility residential treatment
program, or skilled nursing facility) shall be cost-shared on an
inpatient basis. The cost-sharing for inpatient services subject to the
TRICARE DRG-based payment system and the TRICARE per diem system shall
be the lesser of the respective per diem copayment amount multiplied by
the total number of days in the hospital (except for the day of
discharge under the DRG payment system), or 25 percent of the
hospital's billed charges. For other inpatient services, the cost-share
shall be 25% of the CHAMPUS-determined allowable charges.
* * * * *
(g) * * *
(1) Not medically or psychologically necessary. Services and
supplies that are not medically or psychologically necessary for the
diagnosis or treatment of a covered illness (including mental disorder,
to include substance use disorder) or injury, for the diagnosis and
treatment of pregnancy or well-baby care except as provided in the
following paragraph.
* * * * *
(29) Sex gender changes. Services and supplies related to sex
gender change, also referred to as sex reassignment surgery, as
prohibited by section 1079 of title 10, United States Code. This
exclusion does not apply to surgery and related medically necessary
services performed to correct sex gender confusion/intersex conditions
(that is, ambiguous genitalia) which has been documented to be present
at birth.
* * * * *
(73) Economic interest in connection with mental health admissions.
Inpatient mental health services (including both acute care and RTC
services) are excluded for care received when a patient is referred to
a provider of such services by a physician (or other health care
professional with authority to admit) who has an economic interest in
the facility to which the patient is referred, unless a waiver is
granted. Requests for waiver shall be considered under the same
procedure and based on the same criteria as used for obtaining
preadmission authorization (or continued stay authorization for
emergency admissions), with the only additional requirement being that
the economic interest be disclosed as part of the request. This
exclusion does not apply to services under the Extended Care Health
Option (ECHO) in Sec. 199.5 or provided as partial hospital care. If a
situation arises where a decision is made to exclude CHAMPUS payment
solely on the basis of the provider's economic interest, the normal
CHAMPUS appeals process will be available.
* * * * *

0
4. Section 199.6 is amended by revising paragraphs (b)(4)(iv)(B) and
(D), (b)(4)(vii), (b)(4)(xii), and (b)(4)(xiv), and adding paragraphs
(b)(4)(xviii) and (xix) to read as follows:


Sec. 199.6 TRICARE-authorized providers.

(b) * * *
(4) * * *
(iv) * * *
(B) In order for the services of a psychiatric hospital to be
covered, the hospital shall comply with the provisions outlined in
paragraph (b)(4)(i) of this section. All psychiatric hospitals shall be
accredited under an accrediting organization approved by the Director,
in order for their services to be cost-shared under CHAMPUS. In the
case of those psychiatric hospitals that are not accredited because
they have not been in operation a sufficient period of time to be
eligible to request an accreditation survey, the Director, or a
designee, may grant temporary approval if the hospital is certified and
participating under Title XVIII of the Social Security Act (Medicare,
Part A). This temporary approval expires 12 months from the date on
which the psychiatric hospital first becomes eligible to request an
accreditation survey by an accrediting organization approved by the
Director.
* * * * *
(D) Although psychiatric hospitals are accredited under an
accrediting organization approved by Director, their medical records
must be maintained in accordance with accrediting organization's
current standards manual, along with the requirements set forth in
Sec. 199.7(b)(3). The hospital is responsible for assuring that
patient services and all treatment are accurately documented and
completed in a timely manner.
* * * * *
(vii) Residential treatment centers. This paragraph (b)(4)(vii)
establishes the definition of and eligibility standards and
requirements for residential treatment centers (RTCs).
(A) Organization and administration--(1) Definition. A Residential
Treatment Center (RTC) is a facility or a distinct part of a facility
that provides to beneficiaries under 21 years of age a medically
supervised, interdisciplinary program of mental health treatment. An
RTC is appropriate for patients whose predominant symptom presentation
is essentially stabilized, although not resolved, and who have
persistent dysfunction in major life areas. Residential treatment may
be complemented by family therapy and case management for community
based resources. Discharge planning should support transitional care
for the patient and family, to

[[Page 61092]]

include resources available in the geographic area where the patient
will be residing. The extent and pervasiveness of the patient's
problems require a protected and highly structured therapeutic
environment. Residential treatment is differentiated from:
(i) Acute psychiatric care, which requires medical treatment and
24-hour availability of a full range of diagnostic and therapeutic
services to establish and implement an effective plan of care which
will reverse life-threatening and/or severely incapacitating symptoms;
(ii) Partial hospitalization, which provides a less than 24-hour-
per-day, seven-day-per-week treatment program for patients who continue
to exhibit psychiatric problems but can function with support in some
of the major life areas;
(iii) A group home, which is a professionally directed living
arrangement with the availability of psychiatric consultation and
treatment for patients with significant family dysfunction and/or
chronic but stable psychiatric disturbances;
(iv) Therapeutic school, which is an educational program
supplemented by psychological and psychiatric services;
(v) Facilities that treat patients with a primary diagnosis of
substance use disorder; and
(vi) Facilities providing care for patients with a primary
diagnosis of mental retardation or developmental disability.
(2) Eligibility. (i) In order to qualify as a TRICARE authorized
provider, every RTC must meet the minimum basic standards set forth in
paragraphs (b)(4)(vii)(A) through (C) of this section, and as well as
such additional elaborative criteria and standards as the Director
determines are necessary to implement the basic standards.
(ii) To qualify as a TRICARE authorized provider, the facility is
required to be licensed and operate in substantial compliance with
state and federal regulations.
(iii) The facility is currently accredited by an accrediting
organization approved by the Director.
(iv) The facility has a written participation agreement with
OCHAMPUS. The RTC is not a CHAMPUS-authorized provider and CHAMPUS
benefits are not paid for services provided until the date upon which a
participation agreement is signed by the Director.
(B) Participation agreement requirements. In addition to other
requirements set forth in this paragraph (b)(4)(vii), for the services
of an RTC to be authorized, the RTC shall have entered into a
Participation Agreement with OCHAMPUS. The period of a participation
agreement shall be specified in the agreement, and will generally be
for not more than five years. In addition to review of a facility's
application and supporting documentation, an on-site inspection by
OCHAMPUS authorized personnel may be required prior to signing a
Participation Agreement. Retroactive approval is not given. In
addition, the Participation Agreement shall include provisions that the
RTC shall, at a minimum:
(1) Render residential treatment center inpatient services to
eligible CHAMPUS beneficiaries in need of such services, in accordance
with the participation agreement and CHAMPUS regulation;
(2) Accept payment for its services based upon the methodology
provided in Sec. 199.14(f) or such other method as determined by the
Director;
(3) Accept the CHAMPUS all-inclusive per diem rate as payment in
full and collect from the CHAMPUS beneficiary or the family of the
CHAMPUS beneficiary only those amounts that represent the beneficiary's
liability, as defined in Sec. 199.4, and charges for services and
supplies that are not a benefit of CHAMPUS;
(4) Make all reasonable efforts acceptable to the Director, to
collect those amounts, which represents the beneficiary's liability, as
defined in Sec. 199.4;
(5) Comply with the provisions of Sec. 199.8, and submit claims
first to all health insurance coverage to which the beneficiary is
entitled that is primary to CHAMPUS;
(6) Submit claims for services provided to CHAMPUS beneficiaries at
least every 30 days (except to the extent a delay is necessitated by
efforts to first collect from other health insurance). If claims are
not submitted at least every 30 days, the RTC agrees not to bill the
beneficiary or the beneficiary's family for any amounts disallowed by
CHAMPUS;
(7) Certify that:
(i) It is and will remain in compliance with the TRICARE standards
and provisions of paragraph (b)(4)(vii) of this section establishing
standards for Residential Treatment Centers; and
(ii) It will maintain compliance with the CHAMPUS Standards for
Residential Treatment Centers Serving Children and Adolescents with
Mental Disorders, as issued by the Director, except for any such
standards regarding which the facility notifies the Director that it is
not in compliance.
(8) Designate an individual who will act as liaison for CHAMPUS
inquiries. The RTC shall inform OCHAMPUS in writing of the designated
individual;
(9) Furnish OCHAMPUS, as requested by OCHAMPUS, with cost data
certified by an independent accounting firm or other agency as
authorized by the Director, OCHAMPUS;
(10) Comply with all requirements of this section applicable to
institutional providers generally concerning accreditation
requirements, preauthorization, concurrent care review, claims
processing, beneficiary liability, double coverage, utilization and
quality review, and other matters;
(11) Grant the Director, or designee, the right to conduct quality
assurance audits or accounting audits with full access to patients and
records (including records relating to patients who are not CHAMPUS
beneficiaries) to determine the quality and cost-effectiveness of care
rendered. The audits may be conducted on a scheduled or unscheduled
(unannounced) basis. This right to audit/review includes, but is not
limited to:
(i) Examination of fiscal and all other records of the RTC which
would confirm compliance with the participation agreement and
designation as a TRICARE authorized RTC;
(ii) Conducting such audits of RTC records including clinical,
financial, and census records, as may be necessary to determine the
nature of the services being provided, and the basis for charges and
claims against the United States for services provided CHAMPUS
beneficiaries;
(iii) Examining reports of evaluations and inspections conducted by
federal, state and local government, and private agencies and
organizations;
(iv) Conducting on-site inspections of the facilities of the RTC
and interviewing employees, members of the staff, contractors, board
members, volunteers, and patients, as required;
(v) Audits conducted by the United States Government Accountability
Office.
(C) Other requirements applicable to RTCs. (1) Even though an RTC
may qualify as a TRICARE authorized provider and may have entered into
a participation agreement with CHAMPUS, payment by CHAMPUS for
particular services provided is contingent upon the RTC also meeting
all conditions set forth in Sec. 199.4 especially all requirements of
Sec. 199.4(b)(4).
(2) The RTC shall provide inpatient services to CHAMPUS
beneficiaries in the same manner it provides inpatient

[[Page 61093]]

services to all other patients. The RTC may not discriminate against
CHAMPUS beneficiaries in any manner, including admission practices,
placement in special or separate wings or rooms, or provisions of
special or limited treatment.
(3) The RTC shall assure that all certifications and information
provided to the Director, incident to the process of obtaining and
retaining authorized provider status is accurate and that it has no
material errors or omissions. In the case of any misrepresentations,
whether by inaccurate information being provided or material facts
withheld, authorized status will be denied or terminated, and the RTC
will be ineligible for consideration for authorized provider status for
a two year period.
* * * * *
(xii) Psychiatric and substance use disorder partial
hospitalization programs. This paragraph (b)(4)(xii) establishes the
definition of and eligibility standards and requirements for
psychiatric and substance use disorder partial hospitalization
programs.
(A) Organization and administration--(1) Definition. Partial
hospitalization is defined as a time-limited, ambulatory, active
treatment program that offers therapeutically intensive, coordinated,
and structured clinical services within a stable therapeutic milieu.
Partial hospitalization programs serve patients who exhibit psychiatric
symptoms, disturbances of conduct, and decompensating conditions
affecting mental health. Partial hospitalization is appropriate for
those whose psychiatric and addiction-related symptoms or concomitant
physical and emotional/behavioral problems can be managed outside the
hospital for defined periods of time with support in one or more of the
major life areas. A partial hospitalization program for the treatment
of substance use disorders is an addiction-focused service that
provides active treatment to children and adolescents, or adults aged
18 and over.
(2) Eligibility. (i) To qualify as a TRICARE authorized provider,
every partial hospitalization program must meet minimum basic standards
set forth in paragraphs (b)(4)(xii)(A) through (D) of this section, as
well as such additional elaborative criteria and standards as the
Director determines are necessary to implement the basic standards.
Each partial hospitalization program must be either a distinct part of
an otherwise-authorized institutional provider or a free-standing
program. Approval of a hospital by TRICARE is sufficient for its
partial hospitalization program to be an authorized TRICARE provider.
Such hospital-based partial hospitalization programs are not required
to be separately authorized by TRICARE.
(ii) To be approved as a TRICARE authorized provider, the facility
is required to be licensed and operate in substantial compliance with
state and federal regulations.
(iii) The facility is required to be currently accredited by an
accrediting organization approved by the Director. Each PHP authorized
to treat substance use disorder must be accredited to provide the level
of required treatment by an accreditation body approved by the
Director.
(iv) The facility is required to have a written participation
agreement with OCHAMPUS. The PHP is not a CHAMPUS-authorized provider
and CHAMPUS benefits are not paid for services provided until the date
upon which a participation agreement is signed by the Director.
(B) Participation agreement requirements. In addition to other
requirements set forth in this paragraph (b)(4)(xii), in order for the
services of a PHP to be authorized, the PHP shall have entered into a
Participation Agreement with OCHAMPUS. A single consolidated
participation agreement is acceptable for all units of the TRICARE
authorized facility granted that all programs meet the requirements of
this part. The period of a Participation Agreement shall be specified
in the agreement, and will generally be for not more than five years.
The PHP shall not be considered to be a CHAMPUS authorized provider and
CHAMPUS payments shall not be made for services provided by the PHP
until the date the participation agreement is signed by the Director.
In addition to review of a facility's application and supporting
documentation, an on-site inspection by OCHAMPUS authorized personnel
may be required prior to signing a participation agreement. The
Participation Agreement shall include at least the following
requirements:
(1) Render partial hospitalization program services to eligible
CHAMPUS beneficiaries in need of such services, in accordance with the
participation agreement and CHAMPUS regulation.
(2) Accept payment for its services based upon the methodology
provided in Sec. 199.14, or such other method as determined by the
Director;
(3) Accept the CHAMPUS all-inclusive per diem rate as payment in
full and collect from the CHAMPUS beneficiary or the family of the
CHAMPUS beneficiary only those amounts that represent the beneficiary's
liability, as defined in Sec. 199.4, and charges for services and
supplies that are not a benefit of CHAMPUS;
(4) Make all reasonable efforts acceptable to the Director to
collect those amounts, which represent the beneficiary's liability, as
defined in Sec. 199.4;
(5) Comply with the provisions of Sec. 199.8, and submit claims
first to all health insurance coverage to which the beneficiary is
entitled that is primary to CHAMPUS;
(6) Submit claims for services provided to CHAMPUS beneficiaries at
least every 30 days (except to the extent a delay is necessitated by
efforts to first collect from other health insurance). If claims are
not submitted at least every 30 days, the PHP agrees not to bill the
beneficiary or the beneficiary's family for any amounts disallowed by
CHAMPUS;
(7) Certify that:
(i) It is and will remain in compliance with the TRICARE standards
and provisions of paragraph (b)(4)(xii) of this section establishing
standards for psychiatric and substance use disorder partial
hospitalization programs; and
(ii) It will maintain compliance with the CHAMPUS Standards for
Psychiatric Substance Use Disorder Partial Hospitalization Programs, as
issued by the Director, except for any such standards regarding which
the facility notifies the Director, or designee, that it is not in
compliance.
(8) Designate an individual who will act as liaison for CHAMPUS
inquiries. The PHP shall inform the Director, or designee, in writing
of the designated individual;
(9) Furnish OCHAMPUS, as requested by OCHAMPUS, with cost data
certified by an independent accounting firm or other agency as
authorized by the Director;
(10) Comply with all requirements of this section applicable to
institutional providers generally concerning accreditation
requirements, preauthorization, concurrent care review, claims
processing, beneficiary liability, double coverage, utilization and
quality review, and other matters;
(11) Grant the Director, or designee, the right to conduct quality
assurance audits or accounting audits with full access to patients and
records (including records relating to patients who are not CHAMPUS
beneficiaries) to determine the quality and cost-effectiveness of care
rendered. The audits may be conducted on a scheduled or unscheduled

[[Page 61094]]

(unannounced) basis. This right to audit/review includes, but is not
limited to:
(i) Examination of fiscal and all other records of the PHP which
would confirm compliance with the participation agreement and
designation as a TRICARE authorized PHP provider;
(ii) Conducting such audits of PHP records including clinical,
financial, and census records, as may be necessary to determine the
nature of the services being provided, and the basis for charges and
claims against the United States for services provided CHAMPUS
beneficiaries;
(iii) Examining reports of evaluations and inspections conducted by
federal, state and local government, and private agencies and
organizations;
(iv) Conducting on-site inspections of the facilities of the PHP
and interviewing employees, members of the staff, contractors, board
members, volunteers, and patients, as required;
(v) Audits conducted by the United States General Account Office.
(C) Other requirements applicable to PHPs. (1) Even though a PHP
may qualify as a TRICARE authorized provider and may have entered into
a participation agreement with CHAMPUS, payment by CHAMPUS for
particular services provided is contingent upon the PHP also meeting
all conditions set forth in Sec. 199.4.
(2) The PHP may not discriminate against CHAMPUS beneficiaries in
any manner, including admission practices, placement in special or
separate wings or rooms, or provisions of special or limited treatment.
(3) The PHP shall assure that all certifications and information
provided to the Director incident to the process of obtaining and
retaining authorized provider status is accurate and that is has no
material errors or omissions. In the case of any misrepresentations,
whether by inaccurate information being provided or material facts
withheld, authorized provider status will be denied or terminated, and
the PHP will be ineligible for consideration for authorized provider
status for a two year period.
* * * * *
(xiv) Substance use disorder rehabilitation facilities. This
paragraph (b)(4)(xiv) establishes the definition of eligibility
standards and requirements for residential substance use disorder
rehabilitation facilities (SUDRF).
(A) Organization and administration--(1) Definition. A SUDRF is a
residential or rehabilitation facility, or distinct part of a facility,
that provides medically monitored, interdisciplinary addiction-focused
treatment to beneficiaries who have psychoactive substance use
disorders. Qualified health care professionals provide 24-hour, seven-
day-per-week, assessment, treatment, and evaluation. A SUDRF is
appropriate for patients whose addiction-related symptoms, or
concomitant physical and emotional/behavioral problems reflect
persistent dysfunction in several major life areas. Residential or
inpatient rehabilitation is differentiated from:
(i) Acute psychoactive substance use treatment and from treatment
of acute biomedical/emotional/behavioral problems; which problems are
either life-threatening and/or severely incapacitating and often occur
within the context of a discrete episode of addiction-related
biomedical or psychiatric dysfunction;
(ii) A partial hospitalization center, which serves patients who
exhibit emotional/behavioral dysfunction but who can function in the
community for defined periods of time with support in one or more of
the major life areas;
(iii) A group home, sober-living environment, halfway house, or
three-quarter way house;
(iv) Therapeutic schools, which are educational programs
supplemented by addiction-focused services;
(v) Facilities that treat patients with primary psychiatric
diagnoses other than psychoactive substance use or dependence; and
(vi) Facilities that care for patients with the primary diagnosis
of mental retardation or developmental disability.
(2) Eligibility. (i) In order to become a TRICARE authorized
provider, every SUDRF must meet minimum basic standards set forth in
paragraphs (b)(4)(xiv)(A) through (C) of this section, as well as such
additional elaborative criteria and standards as the Director
determines are necessary to implement the basic standards.
(ii) To be approved as a TRICARE authorized provider, the SUDRF is
required to be licensed and operate in substantial compliance with
state and federal regulations.
(iii) The SUDRF is currently accredited by an accrediting
organization approved by the Director. Each SUDRF must be accredited to
provide the level of required treatment by an accreditation body
approved by the Director.
(iv) The SUDRF has a written participation agreement with OCHAMPUS.
The SUDRF is not considered a TRICARE authorized provider, and CHAMPUS
benefits are not paid for services provided until the date upon which a
participation agreement is signed by the Director.
(B) Participation agreement requirements. In addition to other
requirements set forth in this paragraph (b)(4)(xiv), in order for the
services of an inpatient rehabilitation center for the treatment of
substance use disorders to be authorized, the center shall have entered
into a Participation Agreement with OCHAMPUS. A single consolidated
participation agreement is acceptable for all units of the TRICARE
authorized facility. The period of a Participation Agreement shall be
specified in the agreement, and will generally be for not more than
five years. The SUDRF shall not be considered to be a CHAMPUS
authorized provider and CHAMPUS payments shall not be made for services
provided by the SUDRF until the date the participation agreement is
signed by the Director. In addition to review of the SUDRF's
application and supporting documentation, an on-site visit by OCHAMPUS
representatives may be part of the authorization process. In addition,
such a Participation Agreement may not be signed until an SUDRF has
been licensed and operational for at least six months. The
Participation Agreement shall include at least the following
requirements:
(1) Render applicable services to eligible CHAMPUS beneficiaries in
need of such services, in accordance with the participation agreement
and CHAMPUS regulation;
(2) Accept payment for its services based upon the methodology
provided in Sec. 199.14, or such other method as determined by the
Director;
(3) Accept the CHAMPUS-determined rate as payment in full and
collect from the CHAMPUS beneficiary or the family of the CHAMPUS
beneficiary only those amounts that represent the beneficiary's
liability, as defined in Sec. 199.4, and charges for services and
supplies that are not a benefit of CHAMPUS;
(4) Make all reasonable efforts acceptable to the Director to
collect those amounts which represent the beneficiary's liability, as
defined in Sec. 199.4;
(5) Comply with the provisions of Sec. 199.8, and submit claims
first to all health insurance coverage to which the beneficiary is
entitled that is primary to CHAMPUS;
(6) Furnish OCHAMPUS with cost data, as requested by OCHAMPUS,
certified to by an independent accounting firm or other agency as
authorized by the Director;
(7) Certify that:
(i) It is and will remain in compliance with the provisions of
paragraph

[[Page 61095]]

(b)(4)(xiv) of the section establishing standards for substance use
disorder rehabilitation facilities; and
(ii) It has conducted a self-assessment of the facility's
compliance with the CHAMPUS Standards for Substance Use Disorder
Rehabilitation Facilities, as issued by the Director and notified the
Director of any matter regarding which the facility is not in
compliance with such standards; and
(iii) It will maintain compliance with the CHAMPUS Standards for
Substance Use Disorder Rehabilitation Facilities, as issued by the
Director, except for any such standards regarding which the facility
notifies the Director that it is not in compliance.
(8) Designate an individual who will act as liaison for CHAMPUS
inquiries. The SUDRF shall inform OCHAMPUS in writing of the designated
individual;
(9) Furnish OCHAMPUS, as requested by OCHAMPUS, with cost data
certified by an independent accounting firm or other agency as
authorized by the Director;
(10) Comply with all requirements of this section applicable to
institutional providers generally concerning accreditation
requirements, preauthorization, concurrent care review, claims
processing, beneficiary liability, double coverage, utilization and
quality review, and other matters;
(11) Grant the Director, or designee, the right to conduct quality
assurance audits or accounting audits with full access to patients and
records (including records relating to patients who are not CHAMPUS
beneficiaries) to determine the quality and cost effectiveness of care
rendered. The audits may be conducted on a scheduled or unscheduled
(unannounced) basis. This right to audit/review included, but is not
limited to:
(i) Examination of fiscal and all other records of the center which
would confirm compliance with the participation agreement and
designation as an authorized TRICARE provider;
(ii) Conducting such audits of center records including clinical,
financial, and census records, as may be necessary to determine the
nature of the services being provided, and the basis for charges and
claims against the United States for services provided CHAMPUS
beneficiaries;
(iii) Examining reports of evaluations and inspection conducted by
federal, state and local government, and private agencies and
organizations;
(iv) Conducting on-site inspections of the facilities of the SUDRF
and interviewing employees, members of the staff, contractors, board
members, volunteers, and patients, as required.
(v) Audits conducted by the United States Government Accountability
Office.
(C) Other requirements applicable to substance use disorder
rehabilitation facilities.
(1) Even though a SUDRF may qualify as a TRICARE authorized
provider and may have entered into a participation agreement with
CHAMPUS, payment by CHAMPUS for particular services provided is
contingent upon the SUDRF also meeting all conditions set forth in
Sec. 199.4.
(2) The center shall provide inpatient services to CHAMPUS
beneficiaries in the same manner it provides services to all other
patients. The center may not discriminate against CHAMPUS beneficiaries
in any manner, including admission practices, placement in special or
separate wings or rooms, or provisions of special or limited treatment.
(3) The substance use disorder facility shall assure that all
certifications and information provided to the Director, incident to
the process of obtaining and retaining authorized provider status, is
accurate and that it has no material errors or omissions. In the case
of any misrepresentations, whether by inaccurate information being
provided or material facts withheld, authorized provider status will be
denied or terminated, and the facility will be ineligible for
consideration for authorized provider status for a two year period.
* * * * *
(xviii) Intensive outpatient programs. This paragraph (b)(4)(xviii)
establishes standards and requirements for intensive outpatient
treatment programs for psychiatric and substance use disorder.
(A) Organization and administration--(1) Definition. Intensive
outpatient treatment (IOP) programs are defined in Sec. 199.2. IOP
services consist of a comprehensive and complimentary schedule of
recognized treatment approaches that may include day, evening, night,
and weekend services consisting of individual and group counseling or
therapy, and family counseling or therapy as clinically indicated for
children and adolescents, or adults aged 18 and over, and may include
case management to link patients and their families with community
based support systems.
(2) Eligibility. (i) In order to qualify as a TRICARE authorized
provider, every intensive outpatient program must meet the minimum
basic standards set forth in paragraphs (b)(4)(xviii)(A) through (C) of
this section, as well as additional elaborative criteria and standards
as the Director determines are necessary to implement the basic
standards. Each intensive outpatient program must be either a distinct
part of an otherwise-authorized institutional provider or a free-
standing psychiatric or substance use disorder intensive outpatient
program. Approval of a hospital by TRICARE is sufficient for its IOP to
be an authorized TRICARE provider. Such hospital-based intensive
outpatient programs are not required to be separately authorized by
TRICARE.
(ii) To qualify as a TRICARE authorized provider, the IOP is
required to be licensed and operate in substantial compliance with
state and federal regulations.
(iii) The IOP is currently accredited by an accrediting
organization approved by the Director. Each IOP authorized to treat
substance use disorder must be accredited to provide the level of
required treatment by an accreditation body approved by the Director.
(iv) The facility has a written participation agreement with
TRICARE. The IOP is not considered a TRICARE authorized provider and
TRICARE benefits are not paid for services provided until the date upon
which a participation agreement is signed by the Director.
(B) Participation agreement requirements. In addition to other
requirements set forth in paragraph (b)(4)(xii) of this section, in
order for the services of an IOP to be authorized, the IOP shall have
entered into a Participation Agreement with TRICARE. A single
consolidated participation agreement is acceptable for all units of the
TRICARE authorized facility granted that all programs meet the
requirements of this part. The period of a Participation Agreement
shall be specified in the agreement, and will generally be for not more
than five years. In addition to review of a facility's application and
supporting documentation, an on-site inspection by DHA authorized
personnel may be required prior to signing a participation agreement.
The Participation Agreement shall include at least the following
requirements:
(1) Render intensive outpatient program services to eligible
TRICARE beneficiaries in need of such services, in accordance with the
participation agreement and TRICARE regulation.
(2) Accept payment for its services based upon the methodology
provided in Sec. 199.14, or such other method as determined by the
Director;

[[Page 61096]]

(3) Collect from the TRICARE beneficiary or the family of the
TRICARE beneficiary only those amounts that represent the beneficiary's
liability, as defined in Sec. 199.4, and charges for services and
supplies that are not a benefit of TRICARE;
(4) Make all reasonable efforts acceptable to the Director to
collect those amounts, which represent the beneficiary's liability, as
defined in Sec. 199.4;
(5) Comply with the provisions of Sec. 199.8, and submit claims
first to all health insurance coverage to which the beneficiary is
entitled that is primary to TRICARE;
(6) Submit claims for services provided to TRICARE beneficiaries at
least every 30 days (except to the extent a delay is necessitated by
efforts to first collect from other health insurance). If claims are
not submitted at least every 30 days, the IOP agrees not to bill the
beneficiary or the beneficiary's family for any amounts disallowed by
TRICARE;
(7) Free-standing intensive outpatient programs shall certify that:
(i) It is and will remain in compliance with the provisions of
paragraph (b)(4)(xii) of this section establishing standards for
psychiatric and SUD IOPs;
(ii) It has conducted a self-assessment of the facility's
compliance with the CHAMPUS Standards for Intensive Outpatient
Programs, as issued by the Director, and notified the Director of any
matter regarding which the facility is not in compliance with such
standards; and
(iii) It will maintain compliance with the TRICARE standards for
IOPs, as issued by the Director, except for any such standards
regarding which the facility notifies the Director, or a designee that
it is not in compliance.
(8) Designate an individual who will act as liaison for TRICARE
inquiries. The IOP shall inform TRICARE, or a designee in writing of
the designated individual;
(9) Furnish OCHAMPUS with cost data, as requested by OCHAMPUS,
certified by an independent accounting firm or other agency as
authorized by the Director.
(10) Comply with all requirements of this section applicable to
institutional providers generally concerning accreditation
requirements, preauthorization, concurrent care review, claims
processing, beneficiary liability, double coverage, utilization and
quality review, and other matters;
(11) Grant the Director, or designee, the right to conduct quality
assurance audits or accounting audits with full access to patients and
records (including records relating to patients who are not CHAMPUS
beneficiaries) to determine the quality and cost effectiveness of care
rendered. The audits may be conducted on a scheduled or unscheduled
(unannounced) basis. This right to audit/review included, but is not
limited to:
(i) Examination of fiscal and all other records of the center which
would confirm compliance with the participation agreement and
designation as an authorized TRICARE provider;
(ii) Conducting such audits of center records including clinical,
financial, and census records, as may be necessary to determine the
nature of the services being provided, and the basis for charges and
claims against the United States for services provided CHAMPUS
beneficiaries;
(iii) Examining reports of evaluations and inspection conducted by
federal, state and local government, and private agencies and
organizations;
(iv) Conducting on-site inspections of the facilities of the IOP
and interviewing employees, members of the staff, contractors, board
members, volunteers, and patients, as required.
(v) Audits conducted by the United States Government Accountability
Office.
(C) Other requirements applicable to Intensive Outpatient Programs
(IOP). (1) Even though an IOP may qualify as a TRICARE authorized
provider and may have entered into a participation agreement with
CHAMPUS, payment by CHAMPUS for particular services provided is
contingent upon the IOP also meeting all conditions set forth in Sec.
199.4.
(2) The IOP may not discriminate against CHAMPUS beneficiaries in
any manner, including admission practices, placement in special or
separate wings or rooms, or provisions of special or limited treatment.
(3) The IOP shall assure that all certifications and information
provided to the Director incident to the process of obtaining and
retaining authorized provider status is accurate and that is has no
material errors or omissions. In the case of any misrepresentations,
whether by inaccurate information being provided or material facts
withheld, authorized provider status will be denied or terminated, and
the IOP will be ineligible for consideration for authorized provider
status for a two year period.
(xix) Opioid Treatment Programs (OTPs). This paragraph (b)(4)(xix)
establishes standards and requirements for Opioid Treatment Programs.
(A) Organization and administration. (1) Definition. Opioid
Treatment Programs (OTPs) are defined in Sec. 199.2. Opioid Treatment
Programs (OTPs) are organized, ambulatory, addiction treatment services
for patients with an opioid use disorder. OTPs have the capacity to
provide daily direct administration of medications without the
prescribing of medications. Medication supplies for patients to take
outside of OTPs originate from within OTPs. OTPs offer medication
assisted treatment, patient-centered, recovery-oriented individualized
treatment through addiction counseling, mental health therapy, case
management, and health education.
(2) Eligibility. (i) Every free-standing Opioid Treatment Program
must be accredited by an accrediting organization recognized by
Director, under the current standards of an accrediting organization,
as well as meet additional elaborative criteria and standards as the
Director determines are necessary to implement the basic standards.
OTPs adhere to requirements of the Department of Health and Human
Services' 42 CFR part 8, the Substance Abuse and Mental Health Services
Administration's Center for Substance Abuse Treatment, and the Drug
Enforcement Agency. OTPs must be either a distinct part of an otherwise
authorized institutional provider or a free-standing program. Approval
of hospitals by TRICARE is sufficient for their OTPs to be authorized
TRICARE providers. Such hospital-based OTPs, if certified under 42 CFR
8, are not required to be separately authorized by TRICARE.
(ii) To qualify as a TRICARE authorized provider, OTPs are required
to be licensed and fully operational for a period of at least six
months and operate in substantial compliance with state and federal
regulations.
(iii) OTPs have a written participation agreement with OCHAMPUS.
OTPs are not considered a TRICARE authorized provider, and CHAMPUS
benefits are not paid for services provided until the date upon which a
participation agreement is signed by the Director.
(B) Participation agreement requirements. In addition to other
requirements set forth in this paragraph (b)(4)(xix), in order for the
services of OTPs to be authorized, OTPs shall have entered into a
Participation Agreement with TRICARE. A single consolidated
participation agreement is acceptable for all units of a TRICARE
authorized facility. The period of a Participation Agreement shall be
specified in the agreement, and will generally be for not more than
five years. In addition to

[[Page 61097]]

review of a facility's application and supporting documentation, an on-
site inspection by DHA authorized personnel may be required prior to
signing a participation agreement. The Participation Agreement shall
include at least the following requirements:
(1) Render services from OTPs to eligible TRICARE beneficiaries in
need of such services, in accordance with the participation agreement
and TRICARE regulation.
(2) Accept payment for its services based upon the methodology
provided in Sec. 199.14, or such other method as determined by the
Director;
(3) Collect from the TRICARE beneficiary or the family of the
TRICARE beneficiary only those amounts that represent the beneficiary's
liability, as defined in Sec. 199.4, and charges for services and
supplies that are not a benefit of TRICARE;
(4) Make all reasonable efforts acceptable to the Director to
collect those amounts, which represent the beneficiary's liability, as
defined in Sec. 199.4;
(5) Comply with the provisions of Sec. 199.8, and submit claims
first to all health insurance coverage to which the beneficiary is
entitled that is primary to TRICARE;
(6) Submit claims for services provided to TRICARE beneficiaries at
least every 30 days (except to the extent a delay is necessitated by
efforts to first collect from other health insurance). If claims are
not submitted at least every 30 days, OTPs agree not to bill the
beneficiary or the beneficiary's family for any amounts disallowed by
TRICARE;
(7) Free-standing opioid treatment programs shall certify that:
(i) It is and will remain in compliance with the provisions of
paragraph (b)(4)(xii) of this section establishing standards for opioid
treatment programs;
(ii) It will maintain compliance with the TRICARE standards for
OTPs, as issued by the Director, except for any such standards
regarding which the facility notifies the Director, or a designee, that
it is not in compliance.
(8) Designate an individual who will act as liaison for TRICARE
inquiries. OTPs shall inform TRICARE, or a designee, in writing of the
designated individual;
(9) Furnish TRICARE, or a designee, with cost data, as requested by
TRICARE, certified by an independent accounting firm or other agency as
authorized by the Director;
(10) Comply with all requirements of this section applicable to
institutional providers generally concerning accreditation
requirements, claims processing, beneficiary liability, double
coverage, utilization and quality review, and other matters;
(11) Grant the Director, or designee, the right to conduct quality
assurance audits or accounting audits with full access to patients and
records (including records relating to patients who are not TRICARE
beneficiaries) to determine the quality and cost effectiveness of care
rendered. The audits may be conducted on a scheduled or unscheduled
(unannounced) basis. This right to audit/review includes, but is not
limited to:
(i) Examination of fiscal and all other records of OTPs which would
confirm compliance with the participation agreement and designation as
an authorized TRICARE provider;
(ii) Conducting such audits of OTPs' records including clinical,
financial, and census records, as may be necessary to determine the
nature of the services being provided, and the basis for charges and
claims against the United States for services provided TRICARE
beneficiaries;
(iii) Examining reports of evaluations and inspections conducted by
federal, state and local government, and private agencies and
organizations.
(C) Other requirements applicable to OTPs. (1) Even though OTPs may
qualify as a TRICARE authorized provider and may have entered into a
participation agreement with CHAMPUS, payment by CHAMPUS for particular
services provided is contingent upon OTPs also meeting all conditions
set forth in Sec. 199.4.
(2) OTPs may not discriminate against CHAMPUS beneficiaries in any
manner, including admission practices or provisions of special or
limited treatment.
(3) OTPs shall assure that all certifications and information
provided to the Director incident to the process of obtaining and
retaining authorized provider status is accurate and that is has no
material errors or omissions. In the case of any misrepresentations,
whether by inaccurate information being provided or material facts
withheld, authorized provider status will be denied or terminated, and
OTPs will be ineligible for consideration for authorized provider
status for a two year period.
* * * * *


Sec. 199.7 [Amended]

0
5. Section 199.7 is amended by removing and reserving paragraph (e)(2).

0
6. Section 199.14 is amended by revising paragraphs (a)(2)(iv)(C)(2)
and (4) and (a)(2)(ix) to read as follows:


Sec. 199.14 Provider reimbursement methods.

(a) * * *
(2) * * *
(iv) * * *
(C) * * *
(2) Except as provided in paragraph (a)(2)(iv)(C)(3) of this
section, for subsequent federal fiscal years, each per diem shall be
updated by the Medicare Inpatient Prospective Payment System update
factor.
* * * * *
(4) Hospitals and units with hospital-specific rates will be
notified of their respective rates prior to the beginning of each
Federal fiscal year. New hospitals shall be notified at such time as
the hospital rate is determined. The actual amount of each regional per
diem that will apply in any Federal fiscal year shall be posted to the
Agency's official Web site at the start of that fiscal year.
* * * * *
(ix) Payment for psychiatric and substance use disorder
rehabilitation partial hospitalization services, intensive outpatient
psychiatric and substance use disorder services and opioid treatment
services--(A) Per diem payments. Psychiatric and substance use disorder
partial hospitalization services, intensive outpatient psychiatric and
substance use disorder services and opioid treatment services
authorized by Sec. 199.4(b)(9), (b)(10), and (b)(11), respectively,
and provided by institutional providers authorized under Sec.
199.6(b)(4)(xii), (b)(4)(xviii) and (b)(4)(xix), respectively, are
reimbursed on the basis of prospectively determined, all-inclusive per
diem rates pursuant to the provisions of paragraphs (a)(2)(ix)(A)(1)
through (3) of this section, with the exception of hospital-based
psychiatric and substance use disorder and opioid services which are
reimbursed in accordance with provisions of paragraph (a)(6)(ii) of
this section and freestanding opioid treatment programs when reimbursed
on a fee-for-service basis as specified in paragraph
(a)(2)(ix)(A)(3)(ii) of this section. The per diem payment amount must
be accepted as payment in full, subject to the outpatient cost-sharing
provisions under Sec. 199.4(f), for institutional services provided,
including board, routine nursing services, group therapy, ancillary
services (e.g., music, dance, and occupational and other such
therapies), psychological testing and assessment, overhead and any
other services for which the customary practice among

[[Page 61098]]

similar providers is included in the institutional charges, except for
those services which may be billed separately under paragraph
(a)(2)(ix)(B) of this section. Per diem payment will not be allowed for
leave days during which treatment is not provided.
(1) Partial hospitalization programs. For any full-day partial
hospitalization program (minimum of 6 hours), the maximum per diem
payment amount is 40 percent of the average inpatient per diem amount
per case established under the TRICARE mental health per diem
reimbursement system during the fiscal year for both high and low
volume psychiatric hospitals and units [as defined in paragraph (a)(2)
of this section]. Intensive outpatient services provided in a PHP
setting lasting less than 6 hours, with a minimum of 2 hours, will be
paid as provided in paragraph (a)(2)(ix)(A)(2) of this section. PHP per
diem rates will be updated annually by the Medicare update factor used
for their Inpatient Prospective Payment System.
(2) Intensive outpatient programs. For intensive outpatient
programs (IOPs) (minimum of 2 hours), the maximum per diem amount is 75
percent of the rate for a full-day partial hospitalization program as
established in paragraph (a)(2)(ix)(A)(1) of this section. IOP per diem
rates will be updated annually by the Medicare update factor used for
their Inpatient Prospective Payment System.
(3) Opioid treatment programs. Opioid treatment programs (OTPs)
authorized by Sec. 199.4(b)(11) and provided by providers authorized
under Sec. 199.6(b)(4)(xix) will be reimbursed based on the
variability in the dosage and frequency of the drug being administered
and in related supportive services.
(i) Weekly all-inclusive per diem rate. Methadone OTPs will be
reimbursed the lower of the billed charge or the weekly all-inclusive
per diem rate (the weekly national all-inclusive rate adjusted for
locality), including the cost of the drug and related services (i.e.,
the costs related to the initial intake/assessment, drug dispensing and
screening and integrated psychosocial and medical treatment and support
services). The bundled weekly per diem payments will be accepted as
payment in full, subject to the outpatient cost-sharing provisions
under Sec. 199.4(f). The methadone per diem rate for OTPs will be
updated annually by the Medicare update factor used for their Inpatient
Prospective Payment System.
(ii) Exceptions to per diem reimbursement. When providing other
medications which are more likely to be prescribed and administered in
an office-based opioid treatment setting, but which are still available
for treatment of substance use disorders in an outpatient treatment
program setting, OTPs will be reimbursed on a fee-for-service basis
(i.e., separate payments will be allowed for both the medication and
accompanying support services), subject to the outpatient cost-sharing
provisions under Sec. 199.4(f). OTPs' rates will be updated annually
by the Medicare update factor used for their Inpatient Prospective
Payment System.
(iii) Discretionary authority. The Director, TRICARE, will have
discretionary authority in establishing the reimbursement methodologies
for new drugs and biologicals that may become available for the
treatment of substance use disorders in OTPs. The type of reimbursement
(e.g., fee-for-service versus bundled per diem payments) will be
dependent on the variability of the dosage and frequency of the
medication being administered, as well as the support services.
(B) Services which may be billed separately. Psychotherapy sessions
and non-mental health related medical services not normally included in
the evaluation and assessment of PHP, IOP or OTPs, provided by
authorized independent professional providers who are not employed by,
or under contract with, PHP, IOP or OTPs for the purposes of providing
clinical patient care are not included in the per diem rate and may be
billed separately. This includes ambulance services when medically
necessary for emergency transport.
* * * * *


Sec. 199.15 [Amended]

0
7. Section 199.15 is amended in paragraph (a)(6) by removing ``, such
as inpatient mental health services in excess of 30 days in any year''
in the last sentence.

0
8. Section 199.18 is amended by:
0
a. Revising paragraph (d)(2)(ii);
0
b. Removing and reserving paragraph (d)(3)(ii); and
0
c. Revising paragraphs (e)(2) and (3). The revisions read as follows:


Sec. 199.18 Uniform HMO Benefit.

* * * * *
(d) * * *
(2) * * *
(ii) The per visit fee provided in paragraph (d)(2)(i) of this
section shall also apply to partial hospitalization services, intensive
outpatient treatment, and opioid treatment program services. The per
visit fee shall be applied on a per day basis on days services are
received, with the exception of opioid treatment program services
reimbursed in accordance with Sec. 199.14(a)(2)(ix)(A)(3)(i) which per
visit fee will apply on a weekly basis.
* * * * *
(e) * * *
(2) Structure of cost-sharing. For inpatient admissions, there is a
nominal copayment for retired members, dependents of retired members,
and survivors. This nominal copayment shall apply to an inpatient
admission to any hospital or other authorized institutional provider,
including inpatient admission to a residential treatment center,
substance use disorder rehabilitation facility residential treatment
program, or skilled nursing facility.
(3) Amount of inpatient cost-sharing requirements. In fiscal year
2001, the inpatient cost-sharing requirements for retirees and their
dependents for acute care admissions and other inpatient admissions is
a per diem charge of $11, with a minimum charge of $25 per admission.
* * * * *

Dated: August 29, 2016.
Aaron Siegel,
Alternate OSD Federal Register Liaison Officer, Department of Defense.
[FR Doc. 2016-21125 Filed 9-1-16; 8:45 am]
BILLING CODE 5001-06-P