CMS pitches tighter physician-owned hospital restrictions

CMS proposed new guidance for physician-owned hospital reimbursement in the 2024 Hospital Inpatient Prospective Payment System proposed rule on April 10.

The proposed rule requires physician-owned hospitals to meet requirements for the whole hospital or rural provider exceptions to Stark Law. Physician-owned hospitals are required to receive permission from CMS to add operating rooms or expand generally.

If the proposed rule goes into effect, CMS would consider expansion exceptions only from eligible hospitals, and the hospitals would be required to include data and information about the expansion in the proposal request. The agency also plans to revise aspects of the expansion request process.

For physician-owned hospitals meeting criteria as high Medicaid facilities, the proposal would reinstate restrictions to the number of expansion exception requests, among others, that were removed in the 2021 Outpatient Prospective Payment System final rule.

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