'Primary engagement' rule costs some hospitals Medicare agreements

To be eligible to participate in Medicare, hospitals must be "primarily engaged" in providing inpatient services, a requirement that has cost numerous smaller or specialized hospitals their Medicare provider agreements due to low inpatient volumes, according to Lexology. Many of these agreement terminations rely on a very narrow interpretation of "primary engagement," with officials relying on dictionary defintions in many cases. While the Centers for Medicare & Medicaid Services have no formal agency definition of the term, Lexology recommends assessing risk using such indicators as whether at least 51 percent of patient beds are used for inpatient care. Article

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