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Federal Register / Vol. 86, No. 88 / Monday, May 10, 2021 / Rules and Regulations 412.230a1 except paragraph a5.
Because 412.230a1 excepts paragraph a5, we believe it is necessary to make a specific conforming revision to 412.230a5i, in addition to the general rule at 412.230a1iii, to clarify that the general rule at 412.230a1iii applies to 412.230a5i as well. That is, we are amending the regulation at 412.230a5i to add language stating that an urban hospital that has been granted redesignation as rural under 412.103 is considered to be located in the rural area of the state for the purposes of paragraph a5i.
These changes implement the Bates courts interpretation of the requirement at section 1886d8Ei of the Act that the Secretary shall treat the hospital as being located in the rural area. That is, a 412.103 hospital would be considered to be located in the rural area of the state for all purposes of MGCRB reclassification, including the average hourly wage comparisons required by 412.230a5i and d1iiiC. For example, for purposes of 412.230d1iiiC, the 412.103
hospital would compare its average hourly wage to the average hourly wage of all other hospitals in the states rural area. In addition, for purposes of 412.230a5i, a 412.103 hospital may not be redesignated to another area if the pre-classified average hourly wage for that area is lower than the prereclassified average hourly wage of the rural area of the state in which the hospital is located thus, a 412.103
hospital could potentially reclassify to any area with a pre-reclassified average hourly wage that is higher than the prereclassified average hourly wage for the rural area of the state, if it meets all other applicable reclassification criteria.
Therefore, effective for reclassification applications due to the MGCRB on September 1, 2021, for reclassification first effective for FY 2023, a 412.103
hospital could apply for a reclassification under the MGCRB using the states rural area as the area in which the hospital is located. We would also apply the policy in this IFC when deciding timely appeals before the Administrator under 412.278 for reclassifications beginning in FY 2022
that were denied by the MGCRB due to existing policy, which did not permit 412.103 hospitals to be considered located in the states rural area.
III. Waiver of Proposed Rulemaking and Delay in Effective Date We ordinarily publish a notice of proposed rulemaking in the Federal Register and invite public comment on
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the proposed rule before the provisions of the rule are finalized, either as proposed or as amended, in response to public comments and take effect, in accordance with the Administrative Procedure Act APA Pub. L. 79404, 5 U.S.C. 553 and, where applicable, section 1871 of the Act. Specifically, 5
U.S.C. 553 requires the agency to publish a notice of proposed rulemaking in the Federal Register that includes a reference to the legal authority under which the rule is proposed, and the terms and substances of the proposed rule or a description of the subjects and issues involved. Section 553c of the APA further requires the agency to give interested parties the opportunity to participate in the rulemaking through public comment before the provisions of the rule take effect. Similarly, section 1871b1 of the Act requires the Secretary to provide for notice of the proposed rule in the Federal Register and a period of not less than 60 days for public comment for rulemaking carrying out the administration of the insurance programs under Title XVIII of the Act.
Section 553bB of the APA and section 1871b2C of the Act authorize the agency to waive these procedures, however, if the agency finds good cause that notice and comment procedures are impracticable, unnecessary, or contrary to the public interest and incorporates a statement of the finding and its reasons in the rule issued.
Section 553d of the APA ordinarily requires a 30-day delay in the effective date of a final rule from the date of its publication in the Federal Register.
This 30-day delay in effective date can be waived, however, if an agency finds good cause to support an earlier effective date. Section 1871e1Bi of the Act also prohibits a substantive rule from taking effect before the end of the 30-day period beginning on the date the rule is issued or published. However, section 1871e1Bii of the Act permits a substantive rule to take effect before 30 days if the Secretary finds that a waiver of the 30-day period is necessary to comply with statutory requirements or that the 30-day delay would be contrary to the public interest.
Finally, the Congressional Review Act CRA Pub. L. 104121, Title II
requires a 60-day delay in the effective date for major rules unless an agency finds good cause that notice and public procedure are impracticable, unnecessary, or contrary to the public interest, in which case the rule shall take effect at such time as the agency determines 5 U.S.C. 801a3 and 8082.

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We find good cause for waiving notice-and comment rulemaking and a delay in effective date given the decision of the district court and the public interest in expeditious implementation of the courts interpretation of the statute. Revising the regulation text by adding 412.230a1iii and revising the regulation at 412.230a5i through an IFC rather than through the normal notice-and comment rulemaking cycle and waiving the delay of effective date will ensure an expeditious implementation of the courts interpretation by allowing this policy to be applied to FY 2023 MGCRB
reclassification decisions and cases before the Administrator for reclassifications effective beginning FY
2022. Absent this IFC, the earliest effective date of this revision to the regulations would be October 1, 2021
FY 2022 following the normal IPPS/
LTCH PPS notice-and comment rulemaking cycle. An effective date of FY 2022 would only allow the MGCRB
to approve hospitals applications qualifying under this policy for applications due September 1, 2022 for reclassifications effective beginning FY
2024 applications are due to the MGCRB 13 months prior to the start of the fiscal year. Additionally, implementing the courts interpretation via an IFC allows this policy to be applied to cases before the Administrator for reclassifications effective beginning in FY 2022, which supports an expeditious implementation of this policy. Therefore, we find good cause to waive the notice of proposed rulemaking as well as the delay of effective date and to issue this final rule on an interim basis. Even though we are waiving notice of proposed rulemaking requirements and are issuing these provisions on an interim basis, we are providing a 60-day public comment period.
IV. Collection of Information Requirements This document does not impose information collection requirements, that is, reporting, recordkeeping or third-party disclosure requirements.
Consequently, there is no need for review by the Office of Management and Budget under the authority of the Paperwork Reduction Act of 1995 44
U.S.C. 3501 et seq..
V. Regulatory Impact Statement We have examined the impact of this rule as required by Executive Order 12866 on Regulatory Planning and Review September 30, 1993, Executive Order 13563 on Improving Regulation
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