CMS's Outpatient Supervision Rules – A Moving Target

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The Centers for Medicare and Medicaid Services (CMS) has long taken the position that, in order for outpatient hospital services to be covered by Medicare, the services must be supervised by a physician or, in some instances, by a non-physician practitioner. The extent to which that supervision must be demonstrated, however, has been a moving target. In the 2000 Outpatient PPS Rule — that is, the original provider-based rule — CMS said that supervision was presumed to be present if the outpatient service was furnished in the hospital or in a provider-based department located on the hospital's main campus. Thus, most people fairly assumed that the supervision requirement did not pose a significant issue, at least for outpatient services furnished in a hospital or in an on-campus, provider-based location of the hospital. That changed, however, in 2008 when CMS did an about face and began requiring, as a condition of coverage, that hospitals be able to demonstrate physician supervision of outpatient services. No longer was it presumed that hospital outpatient services were supervised even when those services were furnished on the campus of the hospital. CMS's 2008 position created considerable consternation, and since that time CMS has adjusted its position regarding supervision with each OPPS update. These changes are most recently reflected in FFY 2011 Final Outpatient PPS Rule, which went on display November 2, 2010, and will be published in the Federal Register on November 24, 2010. Thomas W. Coons of Ober|Kaler looks at some of the changes.

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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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