Valley wasn't "primarily engaged" in providing inpatient care and
informed the facility that it did not meet the criteria to be certified as
a hospital.
Last September, CMS provided new criteria to state survey agencies
to measure whether a facility was "primarily engaged" in providing
services to inpatients as required for hospitals to participate in
Medicare. According to the updated guidance, the most important fac-
tors in determining whether a facility is "primarily engaged" in provid-
ing inpatient care are whether the facility has, at a minimum, an aver-
age daily census (ADC) of at least 2 inpatients (not including patients
on "observation" status) and an average length of stay (ALOS) for its
inpatients of at least 2 midnights, when measured over the prior 12
months.
CMS advised that, without meeting the minimum ADC and ALOS
criteria, a facility will likely not be deemed as primarily engaged in
treating inpatients and should be denied enrollment as a hospital or
have its enrollment revoked. Moreover, even if a facility meets the
ADC and ALOS criteria, CMS advised that surveyors should also con-
sider additional criteria, including:
• the number of inpatient beds in relation to the size of the facility
and the services offered, which may imply the ratio of inpatient ver-
sus outpatient services the facility intends to provide;
• the volume of outpatient surgical procedures to inpatient surgical
procedures;
• the volume of outpatient versus inpatient procedures for a facility
that calls itself a "surgical" hospital;
• patterns and trends in the ADC by day of the week (for example,
discharges at a surgical hospital that schedule its inpatient cases for
the beginning of the week would occur before the weekend, resulting
in a 0 ADC on Saturdays and Sundays);
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