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CMS Releases Its Final Guidance for Hospitals With Co-Located Services

Analysis  |  By A.J. Plunkett  
   November 17, 2021

"They took out a lot of unnecessary complexity," observed Kurt Patton, MS, RPh, pharmacist, founder of Patton Healthcare Consulting, and former director of accreditation services for The Joint Commission.

Editor's note: This article was originally published by the HCPro Accreditation & Quality Compliance Center.

If your hospital or its satellite buildings are co-located with other healthcare facilities, you now face slightly fewer requirements than first proposed for ensuring compliance with acute care Medicare Conditions of Participation (CoP) when sharing services with other entities not bound to the hospital requirements.

For instance, there is no more discussion on when floating nurses or other personnel meet the CoP for nursing services and there’s no need for a floor plan to show surveyors evaluating whether patient rights are protected as they are transferred from one area to another between co-located healthcare entities.

Those discussions were part of a 10-page memo to CMS state surveyors in May 2019— before COVID-19 —with proposed guidance from the Quality, Safety & Oversight Group in QSO-19-13-Hospital.

After accepting comments on that proposal, that memo is now six pages and is effective immediately for surveyors to use to evaluate compliance as hospitals seek to share services to save money will also delivering quality care, according to CMS.

“Hospitals have increasingly co-located with other hospitals or other healthcare entities as they seek efficiencies and develop different delivery systems of care. Co-location occurs when two Medicare certified hospitals or a Medicare certified hospital and another healthcare entity are located on the same campus or in the same building and share space, staff, or services,” according to the memo.

While the memo has many of the same sections on contracted staff, emergency services and identification of shared spaces, much of the more prescriptive sections are either shortened or deleted. That includes guidance for surveyors to ask for floor plans to evaluate how patients are transported from one space to another and examples of when the use of floating nurses are in violation of CoP requirements.

“They took out a lot of unnecessary complexity,” observed Kurt Patton, MS, RPh, pharmacist, founder of Patton Healthcare Consulting, and former director of accreditation services for The Joint Commission (TJC). 

There was pushback on the proposed guidance from the American Hospital Association and other organizations, although The Joint Commission (TJC), HFAP (now ACHC) and other accrediting organizations made preparations to enforce the requirements.

The revised memo does reinforce CMS’ expectation to maintain patient safety and privacy as patients are cared for in shared spaces.

“All co-located hospitals must demonstrate independent compliance with the hospital CoPs,” says the memo. “This guidance clarifies how hospitals may organize shared spaces, services, personnel, and emergency services to meet regulatory requirements. When hospitals choose to co-locate, they should consider the risk to compliance through any shared space or shared service arrangements.”

And within the guidance, surveyors are told that regardless of why a hospital may be sharing space with other healthcare entities, “when a hospital is in the same location (campus or building) as another hospital or healthcare entity, each entity is responsible for demonstrating its compliance with all applicable Medicare and Medicaid program participation requirements.”

CMS promises it will be updating the State Operations Manual (SOM), Appendix A, with the revised guidance. Eventually. The last time the SOM was updated was in 2020, and much of that was just placeholder language for guidance to come later.

A.J. Plunkett is editor of Inside Accreditation & Quality, a Simplify Compliance publication.

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