Revenue Cycle

November 15 Rural Health Open Door Forum Summary

Medicare Update for CAHs, December 28, 2011

Accountable Care Organizations

A CMS representative came on the line to talk about the Medicare Shared Savings Program final rule, which aims to allow providers to form accountable care organizations and share any savings that occur if specified quality and financial criteria are met. It also aims to promote seamless, coordinated care for providers and beneficiaries to attend carefully to care transitions and manage resources carefully.

The representative explained that CMS has a two-track system so that providers that would like to participate can choose one of two tracks:

  • Track one: Providers can participate where they can share in the savings without requiring that they also agree to share in losses. 
  • Track two: Providers can achieve a higher share of savings if they agree to share in any losses that occur.

The representative reminded the audience that physicians, hospitals, critical access hospitals, federally qualified health centers, and rural health centers can fully participate in the program. In addition, the first start date of the program is April 1, and there is a second start date of July 1, so providers who would choose to participate in this program can start, for the first year they can choose to start on April 1or July 1. After the first year, then the start date will be January 1st of each year. 

Outpatient prospective payment system update

A representative came on the line to give a brief update on the rural health impact of the OPPS final rule. The representative explained that the most significant change for rural hospitals is that CMS established a process for independent review by the Federal APC panel, a request for assignment of the level of supervision other than direct supervision for individual outpatient therapeutic services. That process will begin in calendar year 2012, and for purposes of the supervision discussions, CMS is adding representatives of two small rural PPS hospitals and two representatives of critical access hospitals to the APC Panel. 

Hospital and critical access hospital conditions of participation

A representative came on the line to give a summary of the hospital and critical access hospital conditions of participation proposed rule. Below are the highlights of the items within the rule that will have an effect on CAHs:

Definitions (§ 485.602) and provision of services (§ 485.635)

CMS currently requires CAHs to furnish certain types of services directly rather than through contracts or under arrangements. The proposed rule would eliminate the requirement that the CAH staff must provide certain services directly and changes the heading of the standard “direct services” to “patient services.” It also proposes to revise the language in paragraphs§ 485.635(b)(1) through (b)(4), that the CAH staff furnishes as direct services.

Personnel Qualifications (§ 485.604)

CMS is proposing to revise the definition of a clinical nurse specialist at § 485.604(a) to reflect the definition in the statute at§ 1861(aa)(5)(B). Specifically, CMS proposes to change the definition to state that a clinical nurse specialist is a registered nurse licensed to practice nursing in the state in which the clinical nurse specialist services are performed and that holds an advanced degree in a defined clinical area of nursing from an accredited educational institution.

Surgical Services (§ 485.639)

CMS amended this section by revising the introductory text to read as follows: If a CAH provides surgical services, surgical procedures must be performed in a safe manner by qualified practitioners who have been granted clinical privileges by the governing body, or responsible individual, of the CAH in accordance with the designation requirements under paragraph (a) of this section.

There are a number of additional proposed changes included in this document that could have a significant positive impact on hospital procedures. CAHs are encouraged to review the entire proposed rule and submit comments no later than December 23, 2011.

Health professional shortage area designations update

A representative came on the line to give a brief update on health professional shortage area (HPSA_ designations. The representative explained that on November 3, the Office of Shortage Designation published a list of all existing HPSAs, which means that all of the HPSAs that were in the proposal withdrawal status or the no new data status were officially withdrawn (approximately 1,200 HPSAs). The only implication here is that any provider who was practicing in a designation that was officially withdrawn needs to find another site for placement.

Healthcare Innovation Challenge update

A CMS representative came on the line to give the audience some information on the Healthcare Innovation Challenge. The representative explained that it’s a grant opportunity for up to $1 billion for a very broad solicitation to organizations to come to the innovation center with their ideas about how to improve care and reduce costs in their community, and to come to [CMS] with the best ideas and proposals. There will be awards between $1 and $30 million over the course of three years. The deadline to submit applications is January 22, 2012. More information can be found at


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