March 16, 2016

Provider-Based Attestations: Proceed Cautiously

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Provider-based status generally refers to the relationship between a main provider and a provider-based entity or a department of a provider, a remote location of a hospital, or a satellite facility, that complies with the regulations at 42 C.F.R., Section 413.65. The provider-based rules are site-specific, not service-specific, and the relevant regulation indicates that the effective date is the earliest date that the facility meets all relevant requirements. The approval relates to claim payments applicable to Medicare and Medicaid. 

On-campus, provider-based facilities must be located on the hospital’s main campus (i.e., within 250 yards of the main hospital buildings) or at an off-campus location as long as it meets the distance requirement. “On-campus” encompasses not only provider buildings that are located in self-contained, well-defined settings, but other locations, such as in central city areas where there may be a group of buildings that function as a campus but are not strictly contiguous and may even be crossed by public streets. The Centers for Medicare & Medicaid Services (CMS) Regional Office has discretion on a case-by-case basis to interpret whether a provider has complied with the regulations. 

Off-campus facilities must operate under the ownership and control of the main provider and must be under the administration and supervision of the main provider. These facilities must also be 100-percent owned by the main provider. The main provider and the facility or satellite organization must have the same governing body and operate under the same organizational documents. The main provider must have final responsibility for key operational and personnel decisions. The main location is also very important. Is everyone aware of the 35-mile radius of the hospital campus rule? Well, there has been some controversy regarding how this is determined. A Medicare Administrative Contractor (MAC) or CMS may not agree on the methodology. When I was a CFO and technical monitor manager with CMS, we utilized a measuring protocol from the front door of the main provider building on the campus to the front door of the off-campus facility. This may still be the rule of thumb. Utilizing the end of the parking lot of the main campus and the beginning of the parking lot of the off-campus location may not “cut the mustard.” Be conservative in your calculations to avoid the appeal process. 

Let us now examine the attestation process. Under 42 C.F. R. Section 413.65 (b) (3), providers may choose to obtain a determination of provider-based status by submitting, to their MAC, an attestation indicating that their facility meets the relevant provider-based requirements. Off-campus facilities in which physician services are performed, of the type typically furnished in a physician office, are presumed to be freestanding unless CMS determines it’s provider-based, as summarized in 42 C.F.R. Section 413.65 (b) (4).

All attestations, whether for on-campus facilities or off-campus facilities, must discuss various items. These include disclosing the identity of the main provider and the provider-based department (PBD), the exact location of the PBD, supporting documentation for off-campus facilities, the effective date the PBD became part of the main provider, and a contact person at the hospital for questions about the PBD. Some recommendations for the appropriate attestation documentation would include copies of the articles of incorporation and bylaws for the main provider and the PBD. In addition, a description of the final approval processes for administrative decisions, contracts with outside parties, personnel policies, and medical staff appointments for the PBD, would assist the MAC and CMS reviewers in favorably concluding that the attestation is in accordance with the requirements in the regulations. Finally, and most importantly, make sure it is apparent that the individual who signs the attestation for the hospital is authorized to do so. When I reviewed these attestations in my previous life at CMS, this was an issue on more than one occasion.

As I have done in previous articles, I will end with a Provider Reimbursement Review Board (PRRB) tip. If you find yourself in the PRRB appeal process due to a final unfavorable determination regarding a provider-based application or some other Medicare cost report controversy, you may need the services of an expert or other witnesses to help support your case. The witness list must be filed with the Board and served on the opposite party (i.e. CMS or its MAC representative) at least 30 days before the hearing date.

The list must identify each witness, the witness’s relationship to the hospital, and the nature of the testimony. If the hospital intends to qualify the witness as an expert, the hospital must designate his/her field of expertise and state the subject of the testimony. You also must forward a copy of the expert’s resume and a report from the expert that summarizes his/her anticipated testimony (background facts, principles, and/or opinions) and the bases supporting such testimony.

The PRRB considers this testimony in rendering its decision, and if the opposing party does not provide an expert, you will definitely have an advantage and likely will improve your chances of a favorable outcome.

About the Author 

Stanley J Sokolove, CPA, is a former CFO technical compliance monitor for CMS. In that role, Mr. Sokolove provided oversight of the banking, finance and internal controls for CMS relating to NHIC, Corp., the DME MAC for Jurisdiction A. Prior to this position, Mr. Sokolove was an Administrative Law Judge, serving as a member of the Provider Reimbursement Review Board in Baltimore, Md. Mr. Sokolove is a member of the RACmonitor editorial board and makes frequent appearances on Monitor Mondays. 

Contact the Author 

ssokolove@comcast.net 

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