CMS Clarifies IPPS Rule on Services Made 'Under Arrangement'

At first blush, this does not seem concerning because these are not the types of services normally thought of as provided “under arrangement.” However, the CMS makes it clear that it considers even registry or contracted nursing services to be provided “under arrangement” and not by the hospital: 

In situations in which certain routine services are provided under arrangements ‘‘in the hospital,’’ for example, contracted nursing services, we believe the arrangement generally results in the hospital exercising the same level of control over those services as the hospital does in situations in which the services are provided by the hospital’s salaried employees. Therefore, if these services are provided in the hospital to its inpatients, we consider the services as being provided by the hospital. However, if these services are provided outside the hospital, the services are considered as being provided under arrangement, and not by the hospital.

CMS’s clarification does afford hospitals an exception for the most common of these registry or contracted nurses arrangements, as long as the service is provided in the hospital. However, it  leaves some unanswered questions that may be addressed in the final rule, Hoy says. “What about clinical social worker (CSW) services? Does this extend to those services and will the same exception apply that if they are provided in the hospital they will be considered to be provided by the hospital? Presumably whatever change is made would also apply to these services, but it’s unclear as of now.”

Other open questions include how the clarification will apply to nursing services associated with diagnostic and therapeutic services that are purchased under arrangements (e.g. recovery services) and to what extent it may affect other contractual arrangements when the hospital has to provide services that it is unable to provide directly.