Good News from CMS Region 6

Over the last few months, PSOs, providers and provider associations have been fighting for the Patient Safety and Quality Improvement Act (PSQIA) protections of hospitals in CMS Region 6.  State surveyors had demanded access to PSWP, threatening termination of Medicare participation if they did not get it.  The final outcome is very favorable to PSO participants and is outlined in detail below.  The following information was provided by Chicago attorney Michael Callahan, one of the most active PSO law experts.  His summary outlines the great outcome, but also lays a path for successful advocacy in this sort of situation.


Last year, state surveyors acting on behalf of CMS Region 6 conducted Federal surveys at four separate health care facilities located in Texas, New Mexico and Oklahoma. Each of these facilities contracted with a PSO. During the on-site investigation, the surveyors requested numerous documents to determine whether the facility was in compliance with the Medicare Conditions of Participation, including information which the facilities identified as PSWP. Despite efforts to inform the surveyors that the requested information was privileged under the Patient Safety Act, each facility received a nearly identical letter from the state surveyors…informing them that their refusal to provide the documents would result in the termination of their Medicare eligibility. These threats were made even though the facilities offered to cooperate with the investigation and to provide the surveyors with non-privileged information which they believed would demonstrate their compliance with the CoPs and QAPI. One surveyor, in response to one of the facility’s assertion of the privilege protections, stated that they were “entitled to see anything they wanted” in carrying out their legal authority. Because none of the hospitals could afford to lose their Medicare eligibility, each of them turned over the privileged materials.

Not surprisingly, these threats caused great concern because the apparent position of CMS Region 6, as communicated through the state surveyors, was at odds with a previously stated position of CMS in 2013 along with the HHS Guidance Regarding Patient Safety Work Product and Providers’ External Obligations issued on May 24, 2016,  that CMS and other federal and state regulators “should not demand PSWP from providers or PSOs” and that PSWP “may not be used to satisfy external obligations.”

…[T]he Federation of American Hospitals, the Texas Hospital Association, the Dallas-Fort Worth Hospital Council and the New Mexico Hospital Association agreed to work with these several Region 6 health systems. Rather than approach Main CMS in Baltimore, the group decided that they should reach out directly to representatives at Region 6.

A joint letter from the associations…to both the Deputy Consortium Administrator for Dallas/Atlanta and the Deputy Regional Administrator requested a meeting…[and] described the circumstances at the three facilities. [It also shared] the providers’ communications with the surveyors to demonstrate each of the hospital’s participation in a PSO… Region 6 agreed to a meeting which took place on Thursday, March 7th in their Dallas office.

To help facilitate the meeting, the associations sent five questions to Region 6 in advance which essentially were designed to understand the basis for its position that the refusal to turn over PSWP would lead to their termination from Medicare. In addition, they asked why Region 6 was taking a position which was contrary to HHS’s and CMS’s published statement that Medicare facilities were not required to turn over PSWP although were otherwise obligated to demonstrate compliance with the CoPs and other regulatory requirements.

After introductions were made, and to the great relief of the trade associations, the first statement made by one of the Region 6 administrators was that “CMS does not require Medicare facilities to turn over privileged PSWP” during a Federal survey. Over the course of the next 40 minutes, Region 6’s representations can be summarized as follows:

A. Region 6 Representations

  1. Region 6 has trained the state surveyors in all 5 states to not require facilities to turn over PSWP. An example was given when, on one occasion, Region 6 advised a state surveyor that they could not request PSWP during an on-site survey.
  2. While facilities are otherwise expected to disclose non-privileged information to establish compliance with the Medicare CoPs, the failure to do so would likely result in a citation but not termination from the Medicare program.
  3. The threatening letters which the three facilities received were based on a template which was prepared by Region 6 and distributed to all state surveyors to more directly apply to a situation when a facility refuses to give state surveyors access in order for them to contact a survey.
  4. The letters should not have been issued and were not intended to address a situation in which a facility declines to turn over PSWP.
  5. Had either the surveyors or any of the facilities contacted Region 6,  they would have been advised that PSWP does not have to be disclosed. No such calls were made.

B. Region 6 Commitments

  1. Region 6 is going to retrain all of their state surveyors that a refusal to turn over PSWP is not just cause for terminating a facility’s Medicare eligibility or for even for making a threat of termination.
  2. The template letter will be revised.
  3. Region 6 recommended, and the trade association representatives agreed, that all of the parties collaborate to prepare an educational program for Medicare facilities. The likely topics include:
    • The role of CMS in Federal surveys
    • The responsibilities of Medicare facilities under the CoPs
    • The fact that facilities are not required to turn over PSWP but must otherwise demonstrate compliance with the CoPs
    • Facilities should be prepared to establish that they participate in a PSO and that the documents requested are PSWP.
    • Facilities should feel comfortable in contacting Region 6 when disputes arise during a survey.
  4. It was further recommended that the respective State Departments of Health in all five states be involved with the program so that there is consistency in how state and federal surveys are conducted.

C. Take-Aways and Recommendations

…[I] is certainly possible that hospitals and other facilities participating in a PSO could face similar demands for PSWP as well as termination threats. …[L]isted below are some take away points and recommendations to consider:

  1. CMS does not require facilities to turn over PSWP. When faced with a state surveyor demanding PSWP, a facility should do the following:
    • Remind them that CMS does not require facilities to disclose PSWP but be prepared to establish that the facility is in a PSO and that the information sought is indeed PSWP. This can be demonstrated by showing them, for example, a copy of the PSO member agreement, a copy of your PSES policy, etc. Obviously, you should not let them see the PSWP or a copy of the PSWP.
    • Request that the surveyor contact the applicable CMS regional office and administrator.
    • Contact the CMS regional administrator directly.
    • Never deny access to the surveyor. Be prepared to disclose non-privileged information to establish compliance. (Remember, CPS has always advised its participants that an action plan resulting from protected work is not protected and can be shared.)

A final CPS recommendation:  If disclosure of PSWP appears to be the only option to demonstrate COP compliance, there are options to consider:

  • Information that was not developed in the PSES and has not been reported to the PSO may be dropped out. If you have questions about this option, contact CPS.
  • There also is a written authorization disclosure exception that allows the disclosure of PSWP if all providers identified in the PSWP agree to the disclosure in writing.
  • Work that is protected can be reproduced outside the PSES.

As always, feel free to contact CPS if you have any questions.


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