The Centers for Medicare & Medicaid Services (CMS) is clarifying guidance under Appendix A of the State Operations Manual (SOM) to address the following:
• The Social Security Act, (the Act) Section 1861(e) defines the statutory definition of a hospital.
• A hospital is primarily engaged in providing inpatient services under section 1861(e)(1) of the Act when it is directly providing services to inpatients.
• In order to qualify for a provider agreement as a hospital under Medicare and Medicaid, an entity must meet and continue to meet all of the statutory provisions of §1861(e) of the Act, including the Condition of Participation (CoP) requirements. See also 42 CFR 488.3(a)(1) and 42 CFR 489.12.
(Note: This requirement does not apply to Psychiatric Hospitals or Critical Access Hospitals (CAH), as defined at section 1861(f) of the Act)
• A hospital must have inpatients at the time of survey in order for surveyors to directly observe the actual provision of care and services to patients, and the effects of that care.
• The use of benchmarks for average daily census (ADC) and average length of stay (ALOS) data for the hospital will be two factors, in addition to other factors, utilized to determine if the hospital is primarily engaged.