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Crossing State Lines with Provider-based Locations

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Crossing State Lines with Provider-based Locations

Expanding provider-based service networks across state lines may assist hospitals in meeting community needs.  Murer Consultants has been successful in ensuring compliance and positive CMS determinations for these arrangements, although the process is often complex.   Most recently, Murer assisted a Pennsylvania acute care hospital in receiving CMS approval for a provider-based outpatient facility located in New Jersey.

The CMS regulation applicable to this scenario is seemingly straightforward, stating: “A facility or organization may qualify for provider-based status under this section only if the facility or organization and the main provider are located in the same State or, when consistent with the laws of both States, in adjacent States.”

However, federal licensure requirements state the main hospital and provider-based facility must operate under the same license, except where the State requires a separate license for the provider-based facility, or where State law does not permit licensure of the main hospital and the provider-based facility under a single license.  It is therefore up to the provider to confirm how adjacent states will approach the licensure of the provider-based facility, in order to remain “consistent with the laws of both states.”  Murer Consultants facilitates negotiations with state health departments to achieve this goal.

Despite recent rulemaking surrounding the provider-based designation, there remain significant benefits in establishing hospital provider-based service networks.  For example, certain hospitals may expand their 340B programs through additional child sites.  Furthermore, the CMS reimbursement model applicable to newly established or acquired off-campus provider-based facilities in CY 2017 may still result in a positive financial impact to the hospital, pending services performed.  (Please see Murer’s recent post here for a more in depth discussion of this new reimbursement structure.)

Murer Consultants, Inc. specializes in the provider-based designation, and is available to assist you in designing your service network.  Murer also specializes in reimbursement and revenue optimization, and will design strategies to ensure maximum Medicare reimbursement in provider-based locations.  Should you have any questions regarding the provider-based designation, or would like to explore options by utilizing Murer’s feasibility services, please do not hesitate to contact us at (708) 478-7030.

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