How to qualify for provider-based status
How to qualify for provider-based status
To qualify for provider-based status under the new outpatient PPS rule published by the Health Care Financing Administration (HCFA) April 7, providers must demonstrate that the subordinate facility is an integral part of the main provider. To make this determination, HCFA established seven specific requirements:
- Licensure. The main provider and subordinate facility must operate under the same license except where state law prohibits.
- Ownership and control. The facility must be 100% owned by the main provider. HCFA will not allow an entity owned by two or more providers in a joint venture to be considered a provider-based entity of either. In addition, the facility must have the same governing body and bylaws. It is not sufficient that they share the same governing body of a parent or an affiliate.
- Administrative integration and supervision. The reporting relationship between the entity and main provider must have the same frequency, intensity, and level of accountability as that between the main provider and one of its departments.
- Clinical integration and supervision. Clinical systems integration must be demonstrated by common credentialing, clinical oversight, reporting relationships, supervision, and accountability.
- Financial integration. Financial operations must be fully integrated as demonstrated by shared income and expenses, as well as recognition of the facility’s costs on the main provider’s cost report.
- Public awareness. Subordinate facilities must be held out to the public and payers as part of the main provider.
- Patient population. The subordinate facility must also either be located on the same campus as the main provider or satisfy specific requirements that show the facility serves the same patient population as the main provider.
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