The More Things Change, the More They Stay the Same – CMS’ Guidance on Co-Located Hospitals and the Removal of Certain Hospital Within Hospital Requirements

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With recent changes to the Hospital within Hospital (“HwH”) rules, is it easier to meet the HwH standards? Likely, not. HwHs are hospitals excluded from the inpatient prospective payment system (“IPPS”), such as psychiatric, long-term care, children’s and cancer hospitals, but are located in the same building or on the same campus as another hospital (the “host hospital”). HwHs must still meet Centers for Medicare and Medicaid Services’ (“CMS”) evolving and stringent views on the Conditions of Participation (“COP”) requirements for co-located hospitals. CMS has long been concerned about the financial incentives for hospitals to operate a HwH in form, while in substance, operating it as a department or unit of the host hospital, using the same staff, equipment reporting structure as the host hospital, while receiving the higher reimbursement associated with IPPS-exclusion.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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