Medicare provider-based status allows providers to treat a site of care not located within the four walls of its hospital as part of the main provider entity under its Medicare certification. These facilities are commonly referred to as off-site hospital outpatient departments, or HOPDs. Provider-based status often results in an increase in reimbursement from commercial and government payors, such as Medicare however, the benefits reach further than financial gains.
Under provider-based status, the hospital may take advantage of economies of scale, by operating an ambulatory services network under the parent hospital license, and increase its reimbursement, efficiency, and quality. Capital costs can also be spread among the various subordinate facilities, operating costs will be lower as a result of increased integration, and administrative efficiency will be increased as the administrative processes of the various facilities will be centralized.
Regulatory criteria to become a HOPD
Under 42 C.F.R. 413.65, there are seven regulatory criteria an entity must abide by in order to qualify as a provider-based entity:
- Licensure of the parent organization
- Ownership and control of the subordinate facilities by the parent hospital
- Administration and supervision of subordinate facilities
- Clinical services must be integrated
- Financial integration between parent and subordinate facilities
- Public awareness such that the provider-based facility holds itself out as part of the main hospital, and does not comingle with non-hospital service providers (i.e., free-standing physician offices)
- Physical location – generally must be within 250 yards of parent entity to be considered “on campus” or 35 miles from parent entity to be considered “off campus”
Let us help you get a provider-based attestation.
A provider-based determination is acquired from CMS through a self-attestation process (commonly referred to as a “provider-based attestation”). Submitting an attestation and the subsequent determination from CMS will assure providers that they are meeting the necessary requirements.
The process is very important to ensure a positive determination from CMS as well as a tool to ensure optimum compliance actually exists and is not just a lot of talk or assumptions. Advis has a great deal of experience with all of the provider-based determination processes and has always received positive determinations on behalf of their clients.
THE BIPARTISAN BUDGET ACT OF 2015 & ON-GOING REGULATORY PROCESS
The Bipartisan Budget Act of 2015 (“BBA”) impacted Medicare reimbursement for new off-campus HOPDs, i.e., those that began billing under the Outpatient Prospective Payment System (“OPPS”) after November 2, 2015. For 2017, these new off-campus HOPDs are reimbursed at approximately 50% of the OPPS. CMS has proposed a reduction to 25% of the OPPS for calendar year 2017, but is accepting comments on 40% and others.
The following HOPDs, not impacted by the BBA, continue to be reimbursed at 100% of the OPPS:
- Off-campus HOPDs (within 35 miles) established and billing before November 2, 2015
- On-campus HOPDs (within 250 yards of main hospital)
- HOPDs located within 250 yards of a remote inpatient location of the main hospital
- Hospital-based freestanding emergency departments
Our consultants are well versed in provider based strategies, contact us today.