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Louisiana Tweaks Written Transfer Agreement Requirement

Unlike in other states, this change does not align with CMS’ rule

BY STEPHEN ABRESCH | SEPTEMBER 2022

The Louisiana Department of Health’s Bureau of Health Services Financing finalized changes to the state’s transfer agreement and patient transfer requirements for ASCs a few weeks back. The final rule tweaked the state’s written transfer agreement requirement but did not align it with the Centers for Medicare & Medicaid Services (CMS) requirements adopted in 2019, as other states have.

As part of its September 2019 final burden reduction rule, effective November 29, 2019, CMS removed the requirements at 42 CFR §416.41(b)(3) for an ASC to have a written transfer agreement with a local hospital or hospital admitting privileges for all physicians who practice within the ASC. The agency replaced this with the requirement that an ASC periodically provide a local hospital with written notice of its operations and patient population served. Since CMS made that change, two states—Alaska and Illinois—have amended their written transfer agreement requirements to align with the language adopted by CMS.

Background on Louisiana Regulatory Changes

When the Louisiana Register published the proposed rule in its December 2021 edition, the rule’s original intent was to allow optometrists to perform surgeries such as YAG laser capsulotomies in ASCs, while exempting them from the requirement that each member of the ASC medical staff be a member in good standing of at least one hospital in the community. During a stakeholder engagement call on February 11, 2022, organizations, including ASCA and the Louisiana Ambulatory Surgery Center Association (LASCA), pushed back on the proposal, noting the uneven playing field the proposed rule would create by exempting optometrists from requirements imposed on other medical staff. ASCA additionally advocated for aligning the state’s written transfer agreement requirement with the language adopted by CMS in 2019.

A week following the call, the Bureau of Health Services Financing released an amended version of the rule, which removed the part about optometrists, but tweaked the state’s written transfer agreement requirement. State law at the time required ASCs to secure a written transfer agreement with a local hospital and to ensure that each member of the ASC medical staff is a member in good standing on the medical staff of at least one hospital in the community. If an ASC were unable to secure a written transfer agreement, the regulation provided that, as an alternative, the ASC’s development of written policies and procedures for the safe transfer of patients to a licensed inpatient hospital would substantiate the ASC’s ability to obtain hospital care for a patient if the need should arise.

The updated version of the proposed rule was a mixed bag for ASCs. This version removed the requirement that each member of an ASC’s medical staff be a member in good standing in the local hospital’s medical staff. However, the state left the written transfer agreement requirement in place while deleting the alternative path to compliance if ASCs were unable to secure a written transfer agreement. While this change would negatively affect any ASCs using the alternative path to compliance, a LASCA survey of its membership showed no facilities currently using the alternative. The state finalized its proposed rule on August 20.

Going Forward

While Louisiana chose not to align its written transfer agreement requirement with the language CMS adopted in 2019 like Alaska and Illinois have, a third state, Nevada, has proposed a rule that would bring the state in alignment if finalized. Three years after CMS made its change, states are slowly trending in the same direction.

Write Stephen Abresch with any questions.