In April, CMS unveiled “Hospitals Without Walls,” a COVID-19 pandemic-specific policy likely to affect both hospitals and surgery centers. It provides a path for a Medicare-approved ASC to change its status to a hospital, thus allowing just about any Medicare-approved procedure permitted in a hospital to be performed in a surgery center — and at hospital reimbursement rates.

So far, it appears this program will be available only for the duration of the COVID-19 pandemic. However, there is talk of extending the initiative. Additional CMS background is available at this link. Also, National Medical Billing Services produced a webinar about the program, which is available here

We are in the process of converting several ASCs under the tenets of Hospitals Without Walls. In August, CMS released an exhaustive update regarding regulatory flexibilities, including about the Hospitals Without Walls program. That update is available here.

Speaking of regulations, I often receive questions about unique and tricky legal subjects, including:

  • out-of-network reimbursement;
  • “under arrangement” deals with hospital outpatient surgery departments and physician ownership;
  • paid medical directorships in an ASC for each specialty;
  • profits to an ASC or the physicians for pathology and anesthesia arrangements;
  • selling shares to new surgeons in an ASC at lower amounts;
  • not following medical staff bylaws or the Health Care Quality Improvement Act.

These are difficult-to-understand subjects, but they are valid. It is important to understand the implications for facilities and staff. Work with governing boards and attorneys to conduct a legal review of all your practices.

It is not a coincidence the federal government has dramatically increased funds allocated to healthcare fraud enforcement. On a related note, as a Medicare surveyor myself, I have noticed a huge increase in Life Safety Code violations when selling or buying a surgery center.

It used to be that if an ASC was currently licensed and accredited at the time of sale, the center usually did not have to be up to date on new ASC codes. This appears to be changing. If buying or selling, clarify the policy with governmental bodies and accreditation agencies.

(Earnhart & Associates is a consulting firm specializing in all aspects of outpatient surgery development and management. Address: 5114 Balcones Woods Drive, Suite 307-203, Austin, TX 78759. Phone: (512) 297-7575. Fax: (512) 233-2979. Email: searnhart@earnhart.com. Web: www.earnhart.com. Instagram: Earnhart.Associates.)