Hospitals and Hospital Units

10.2.1.8 - Hospitals and Hospital Units (Rev. 13355; Issued: 08-13-25; Effective: 05-05-25; Implementation: 05-05-25) (This section 10.2.1.8 applies to “standard” hospitals (as the term “hospital” is defined in § 1861(e)(1)), psychiatric hospitals, hospital units, and transplant programs. It does not apply to critical access hospitals, which are a separate provider type and are not “transitioning.”) A. General Background Information Hospitals and hospital units are a provider type that enrolls via the Form CMS-855A. An exception to this is when the hospital is requesting enrollment to bill for practitioner services for hospital departments, outpatient departments, outpatient locations, and/or hospital clinics; in this circumstance, a new Form CMS-855B enrollment application is required. B. Processing Instructions for Hospital Initial Form CMS-855A Applications 1. Receipt of Application Upon receipt of a hospital initial Form CMS-855A application, the contractor shall undertake the following (in whichever order the contractor prefers unless directed otherwise in this chapter): (A) Perform all data validations otherwise required per this chapter. (B) Ensure that the application(s) is complete consistent with the instructions in this chapter. (C) Ensure that the hospital has submitted all documentation otherwise required per this chapter. For hospital initial enrollment, this also includes the following: • Form CMS-1561 (Health Insurance Benefit Agreement, also known as a “provider agreement”) • Evidence of successful electronic submission of the Form HHS-690 through the Office of Civil Rights (OCR) portal, as applicable. (Evidence should be either written or electronic documentation.) (See https://www.hhs.gov/sites/default/files/forms/hhs-690.pdf for more information.) (An authorized official (as defined in § 424.502) must complete, sign, date, and include the Form CMS-1561, though the hospital need not complete those sections of the form reserved for CMS.) Notwithstanding the foregoing, if the Form CMS-1561 or the Form HHS-690 evidence is missing, unsigned, undated, or otherwise incomplete, the contractor need not develop for the form(s) or the information thereon; the contractor shall instead notify the state in its recommendation letter which document(s) was/were missing or otherwise incomplete. For all other missing or incomplete required documentation, the contractor shall follow the normal development instructions in this chapter. 2. Conclusion of Initial Contractor Review (Nothing in this section 10.2.1.8(B) prohibits the contractor from returning or rejecting the hospital application if otherwise permitted to do so per this chapter. When returning or rejecting the application, the contractor shall follow this chapter’s procedures for doing so.) (A) Approval Recommendation If, consistent with the instructions in section 10.2.1.8(B)(2) and this chapter, the contractor believes an approval recommendation is warranted, the contractor shall send the recommendation to the state pursuant to existing practice and this chapter’s instructions. The contractor need not copy the SOG Location or PEOG on the recommendation. Unless CMS directs otherwise, the contractor shall also send to the provider the notification letter in section 10.7.5.1(E) of this chapter. The state will: (1) review the recommendation package for completeness; (2) review the contractor’s recommendation for approval; (3) perform any state-specific functions; and (4) contact the contractor with any questions. The contractor shall respond to any state inquiry in Item (4) within 5 business days. If the inquiry involves the need for the contractor to obtain additional data, documentation, or clarification from the hospital, however, the timeframe is 15 business days; if the provider fails to respond to the contractor within this timeframe, it shall notify the state thereof. The contractor may always contact its PEOG BFL should it need the latter’s assistance with a particular state inquiry. (B) Denial If the contractor determines that a denial is warranted, it shall follow the denial procedures outlined in this chapter. This includes: (1) using the appropriate denial letter format in section 10.7.5.1 of this chapter; and (2) if required under section 10.6.6 (or another CMS directive) of this chapter, referring the matter to PEOG for review prior to denying the application. 3. Completion of State Review The state will notify the contractor once it has completed its review. There are two potential outcomes: (A) Approval Not Recommended If the state does not recommend approval, it will notify the contractor thereof. (The contractor may accept any notification that is in writing (e-mail is fine).) The site visit described in subsection (D)(1) below need not be performed. No later than 5 business days after receiving this notification, the contractor shall commence the actions described in section 10.2.1.8(B)(2)(B) above. (B) Approval Recommended If the state recommends approval, it will typically (though not always) do so via a Form CMS- 1539; the contractor may accept any documentation from the state signifying that the latter recommends approval. (Note that the contractor will not receive a formal tie-in notice.) No later than 5 business days after receipt of the recommendation from the state, the contractor shall send an e-mail to MedicareProviderEnrollment@cms.hhs.gov with the following information and documents: • The Form CMS-855 application (or PECOS Application Data Report) and all application attachments • A copy of the Form CMS-1539 from the state or similar documentation received from the accrediting organization • A copy of the provider-signed Form CMS-1561 • A copy of the draft approval letter, with the effective date shown on the Form CMS-1539 (or similar documentation) included in the draft letter. (See section 10.7.5.1 for the model approval letter.) PEOG will countersign the provider agreement. Based on the information received from the contractor, PEOG will also (1) assign an effective date, (2) assign a CCN, and (3) enter the applicable data into the applicable national database, and (4) approve (with possible edits) the approval letter. Within 5 business days of receiving from PEOG the signed provider agreement, effective date, and CCN, the contractor shall: (1) send the approval letter and a copy of the CMS- countersigned provider agreement to the hospital; (2) send a copy of both the approval letter and the provider agreement to the state and/or accrediting organization (as applicable); and (3) switch the PECOS record from “approval recommended” to “approved” consistent with existing instructions. C. Additional Enrollment Information 1. Swing-Bed Designation A “swing-bed” hospital is one that is approved by CMS to furnish post-hospital skilled nursing facility (SNF) services. That is, hospital (or critical access hospital (CAH)) patients’ beds can “swing” from furnishing hospital services to providing SNF care without the patient necessarily being moved to another part of the building. It receives a separate survey and certification from that of the hospital. Thus, if swing-bed designation is terminated, the hospital still maintains its certification. In addition, the hospital is given an additional CCN to bill for swing-bed services. (The third digit of the CCN will be the letter U, W, Y or Z.) In general, and as stated in 42 CFR § 482.58, in order to obtain swing-bed status the hospital must, among other things: (1) have a Medicare provider agreement; (2) be located in a rural area; and (3) have fewer than 100 non-newborn or intensive care beds. Swing-bed hospitals, therefore, are generally small hospitals in rural areas where there may not be enough SNFs, and the hospital is thus used to furnish SNF services. A separate provider agreement and enrollment for the swing-bed unit is not required. (The hospital’s provider agreement incorporates the swing-bed services.) The hospital can add the swing-bed unit as a practice location via the Form CMS-855A. Additional data on “swing-bed” units can be found in Pub. 100-07, chapter 2, sections 2036 – 2040. 2. Psychiatric and Rehabilitation Units Though these units receive a state survey, a separate provider agreement and enrollment is not required. (The hospital’s provider agreement incorporates these units.) The hospital can add the unit as a practice location to the Form CMS-855A. 3. Multi-Campus Hospitals A multi-campus hospital (MCH) has two or more hospital campuses operating under one CCN. The MCH would report its various units/campuses as practice locations on the Form CMS-855A. For additional information on multi-campus hospitals, see Pub. 100-07, chapter 2, section 2024. 4. Physician-Owned Hospitals As defined in 42 CFR § 489.3, a physician-owned hospital (POH) means any participating hospital (as defined in 42 CFR §489.24) in which a physician or an immediate family member of a physician has an ownership or investment interest in the hospital. The ownership or investment interest may be through equity, debt, or other means, and includes an interest in an entity that holds an ownership or investment interest in the hospital. (This definition does not include a hospital with physician ownership or investment interests that satisfy the requirements at 42 CFR § 411.356(a) or (b).) Section 2(A)(4) of the Form CMS-855A asks the applicant to identify whether it is a physician- owned hospital. If the applicant indicates in Section 2(A)(2) that it is a hospital, it must complete Section 2(A)(4). Applicants that are not hospitals need not complete Section 2(A)(4). At this time, POHs are not required to submit a completed Form CMS-855POH or a completed Attachment 1 of the Form CMS-855A. As stated in the March 12, 2015 announcement in MLN Connects Provider eNews, CMS has extended the deadline for the POH Initial Annual Ownership/Investment Report due to concerns about the accuracy of the data collected in the report. Future instruction regarding the reporting of POH ownership and investment will be provided on the CMS physician self-referral website. 5. Critical Access Hospitals Critical access hospitals (CAHs) are not considered to be a hospital sub-type for enrollment purposes. CAHs instead must be enrolled as a separate, distinct provider type. Thus, if an existing hospital wishes to convert to a CAH, it must submit a Form CMS-855A as an initial enrollment. 6. Hospital Addition of Practice Location In situations where a hospital is adding a practice location, the contractor shall notify the provider in writing that its recommendation for approval does not constitute approval of the facility or group as provider-based under 42 CFR § 413.65. If the contractor makes a recommendation for approval of the provider’s request to add a hospital unit, the contractor shall forward the package to the state agency as described in this chapter. 7. Transplant Programs A transplant program is a component within a transplant hospital that provides transplantation of a particular type of organ to include: heart, lung, liver, kidney, pancreas, or intestine. All organ transplant programs must be located in a hospital that has a Medicare provider agreement. The transplant program will receive a CCN that is separate and distinct from the hospital. For purposes of Medicare enrollment, a hospital transplant program is treated similarly to a hospital sub-unit. If the hospital wishes to add a transplant program, it must check the “other” box in Section 2A2 of the Form CMS-855A, write “transplant program” (and the type(s) thereof, such as liver transplant program, kidney transplant program, etc.) on the space provided, and follow the standard instructions for adding a hospital sub-unit. (If multiple types of transplant programs are listed, the contractor shall (a) treat each as a separate sub-unit for enrollment purposes and (b) process the application in the same fashion it would a hospital application that is reporting/adding multiple sub-units.) No separate enrollment in PECOS need or will be created for the transplant center. D. Section 4 of the Form CMS-855A Regarding Section 4 of the Form CMS-855A, the hospital must list all addresses where it - and not a separately enrolled provider or supplier it owns or operates, such as a nursing home - furnishes services. The hospital’s primary practice location should be the first location identified in Section 4A and the contractor shall treat it as such – unless there is evidence indicating otherwise. NOTE: Hospital departments located at the same address as the main facility need not be listed as practice locations on the Form CMS-855A. If an enrolled hospital seeks to add or delete a rehabilitation, psychiatric, or swing-bed unit, it should submit a Form CMS-855 change of information request and not, respectively, an initial enrollment application or a voluntary termination application. E. Non-Participating Emergency Hospitals, Veterans Administration (VA) Hospitals, and Department of Defense (DOD) Hospitals Non-participating emergency hospitals, VA hospitals and DOD hospitals no longer need to complete a Form CMS-855A enrollment application in order to bill Medicare. F. Form CMS-855B Applications Submitted by Hospitals 1. Group Practices If an entity is enrolling via the Form CMS-855B as a hospital-owned clinic/physician practice, the contractor shall contact the applicant to determine whether the latter will be billing any of the listed locations as provider-based. If the applicant will not be billing as provider-based, the contractor shall process the application normally. If, however, the applicant will bill as provider- based, the contractor shall notify the applicant that the hospital must report any changed practice locations to its contractor via the Form CMS-855A. If the supplier is enrolling as a hospital department (under the “Clinic/Group Practice” category on the Form CMS-855B) or an existing hospital department is undergoing a change of ownership (CHOW), the contractor shall only issue the necessary billing numbers upon notification that a provider agreement has been issued – or, in the case of a CHOW, the provider agreement has been transferred to the new owner. If, however, the supplier is enrolling as a group practice that is merely owned by a hospital (as opposed to being a hospital department), the contractor need not wait until the provider agreement is issued before conveying billing privileges to the group. 2. Individual Billings Assume an individual physician works for a hospital and will bill for services as an individual (i.e., not as part of the hospital service/payment). However, the physician wants to reassign these benefits to the hospital. The hospital will need to enroll with the contractor via the Form CMS- 855B (e.g., as a hospital department, outpatient location).