HHS Issues Final Rule with Annual Civil Monetary Penalties Inflation Adjustments.

Date posted: October 22, 2018

The Department of Health and Human Services (HHS) recently published a final rule detailing the annual inflation-related increases to the civil monetary penalties (CMP) in its regulations.  The final rule provides a chart identifying the various HHS agency administered CMP authorities and the corresponding adjusted penalty amounts. These annual updates are required under the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (the “2015 Act”).  The 2015 Act requires an adjustment for inflation to improve the effectiveness of CMPs and maintain their deterrent effect.  The adjustment is calculated based on the Consumer Price Index for all Urban Consumers for the month of October of the previous adjustment year, and a cost of living multiplier, which totals an adjustment of 1.02041 for this year.

Under the 2015 Act, federal agencies are not required to follow the Administrative Procedure Act public procedures regarding notice, comment, and delay in effective date that are generally required for most rules.  As such, this final rule became effective immediately upon publication.  The new adjustment amounts will apply to penalties assessed on or after October 11, 2018, if the violation occurred on or after November 2, 2015.  The pre-adjustment amounts that were in effect prior to September 6, 2016 will be applied for any penalties assessed prior to September 6, 2016, or if the violation occurred prior to November 2, 2015.

The final rule, including the full chart of adjustments specific to each HHS agency, is available at:

https://www.gpo.gov/fdsys/pkg/FR-2018-10-11/pdf/2018-22005.pdf.

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