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Federal Register / Vol. 78, No. 175 / Tuesday, September 10, 2013 / Notices
1
Pursuant to the Debt Collection Improvement
Act’s amendment to the Federal Civil Penalties
Inflation Adjustment Act of 1990, the third-step in
adjusting a penalty amount requires that the first
adjustment of the penalty be limited to ten percent
of the penalty amount. This step is not applicable
here because the first adjustment to the CMP with
respect to the Patient Safety Act occurred on
September 24, 2009.
confidentiality requirements. In
particular, under § 3.404, a person who
discloses identifiable PSWP in knowing
or reckless violation of the Patient
Safety Act and 42 CFR part 3 shall be
subject to a civil money penalty (CMP)
of not more than $10,000 for each act
constituting a violation.
Congress enacted the Federal Civil
Penalties Inflation Adjustment Act of
1990 (28 U.S.C. 2461 note, as amended
by the Debt Collection Improvement Act
of 1996 (31 U.S.C. 3701)) (Inflation
Adjustment Act), based on its findings
that the impact of CMPs had been
reduced by inflation and that reducing
the impact of CMPs had weakened their
deterrent effect. Inflation Adjustment
Act section 2, 28 U.S.C. 2461 note. In
general, the Inflation Adjustment Act
requires Federal agencies to issue
regulations to adjust for inflation each
CMP provided by law within their
jurisdiction. The Inflation Adjustment
Act applies to civil penalties found
within the Public Health Service Act,
such as the Patient Safety Act’s CMP
provision. The Inflation Adjustment Act
directs agencies to issue regulations to
adjust CMPs under their authority by
October 23, 1996, and to make
additional adjustments at least once
every four years thereafter based on a
specific calculation set forth in the Act.
While the Inflation Adjustment Act
CMP adjustment requirements apply to
most federal statutes, they do not apply
to CMPs included in the Social Security
Act. The CMPs for title II, subtitle F
(Administrative Simplification) of the
Health Insurance Portability and
Accountability Act of 1996 (HIPAA) are
found at section 1176 of the Social
Security Act. Thus, the Inflation
Adjustment Act does not require, or
provide authority for, the Department to
adjust the HIPAA administrative
simplification CMPs.
Because the Patient Safety Act was
enacted after October 23, 1996, we
interpret the Inflation Adjustment Act
as requiring the Department to
determine whether an adjustment for
inflation is necessary for the Patient
Safety Act’s CMP amount at least once
every four years, beginning from the
Patient Safety Act’s date of enactment,
which was July 29, 2005. Accordingly,
on August, 25, 2009, we published a
direct final rule to amend the Patient
Safety and Quality Improvement Rule
by adjusting for inflation the maximum
CMP amount for violations of the
confidentiality provisions of the Rule.
(74 FR 42777 (Aug. 25, 2009).) We chose
to use direct final rulemaking because
we did not expect to receive any adverse
comment on the rule. The Department
did not receive any adverse comments,
and the direct final rule became
effective and the Patient Safety and
Quality Improvement Rule was
amended on November 23, 2009. The
amendment increased the maximum
CMP amount from $10,000 to $11,000.
II. No Adjustment is Necessary
In accordance with the Inflation
Adjustment Act, the Office for Civil
Rights (OCR) has determined that an
adjustment to the maximum CMP
amount for violations of the
confidentiality provisions of the Patient
Safety and Quality Improvement Rule is
not required at this time.
The Inflation Adjustment Act
provides for the adjustment of a penalty
amount through a three-step process.
1
First, we calculate an increase in the
penalty amount by a ‘‘cost-of-living
adjustment.’’ Inflation Adjustment Act
section 5(a), 28 U.S.C. 2461 note. The
Inflation Adjustment Act defines the
cost-of-living adjustment as ‘‘the
percentage (if any) for each civil
monetary penalty by which—(1) the
Consumer Price Index for the month of
June of the calendar year preceding the
adjustment, exceeds (2) the Consumer
Price Index for the month of June of the
calendar year in which the amount of
such civil monetary penalty was last set
or adjusted pursuant to law.’’ Inflation
Adjustment Act section 5(b), 28 U.S.C.
2461 note. Second, we round the
adjustment amount pursuant to the
methodology set forth in section 5(a) of
the Inflation Adjustment Act, which
rounds the increase based on the size of
the underlying penalty, as follows:
Any increase determined under this
subsection shall be rounded to the
nearest—
(1) multiple of $10 in the case of
penalties less than or equal to $100;
(2) multiple of $100 in the case of
penalties greater than $100 but less than
or equal to $1,000;
(3) multiple of $1,000 in the case of
penalties greater than $1,000 but less
than or equal to $10,000;
(4) multiple of $5,000 in the case of
penalties greater than $10,000 but less
than or equal to $100,000;
(5) multiple of $10,000 in the case of
penalties greater than $100,000 but less
than or equal to $200,000; and
(6) multiple of $25,000 in the case of
penalties greater than $200,000.
With respect to step 1 of the
adjustment, the Consumer Price Index
(CPI) for June of 2012 (the calendar year
preceding publication of this Notice)
was 229.478. The CPI for June of 2009
(the calendar year the CMP was last
adjusted for inflation) was 215.693. The
percent change in these CPIs is an
increase of 6.39 percent. This leads to
an unrounded increase in the Patient
Safety Act’s CMP of $702.90.
With respect to step 2 of the
adjustment, we rounded the amount of
the increase ($702.90) to the nearest
multiple of $5,000 because the current
maximum CMP is $11,000, which
places it in tier (4) above (i.e., penalties
greater than $10,000 but less than or
equal to $100,000). The nearest multiple
of $5,000 for the $702.90 increase is
zero.
Thus, based on the above, we are not
amending 42 CFR 3.404(b) at this time,
and the current maximum CMP remains
at $11,000. As required by the Inflation
Adjustment Act, we will consider
whether an adjustment is needed again
in four years.
Dated: September 3, 2013.
Leon Rodriguez,
Director.
[FR Doc. 2013–22006 Filed 9–9–13; 8:45 am]
BILLING CODE 4153–01–P
DEPARTMENT OF HEALTH AND
HUMAN SERVICES
Centers for Disease Control and
Prevention
[30-Day–13–13OE]
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