Provider Agreements and Supplier Approval

Statutory basis.

This section establishes the statutory authority under the Social Security Act for Medicare provider agreements and supplier approval processes.

Basic requirements.

Providers must meet specific conditions of participation, civil rights requirements, and advance directive standards to participate in the Medicare program.

Definition.

For purposes of this part, advance directive means a written instruction, such as a living will or durable power of attorney for health care, recognized under State law (whether statutory or as recognized by the courts of the State), rel...

Requirements for providers.

Requires providers to maintain written policies on advance directives, provide information to patients, document status in medical records, and educate staff and the community.

Effective dates.

These provisions apply to services furnished on or after December 1, 1991 payments made under section 1833(a)(1)(A) of the Act on or after December 1, 1991, and contracts effective on or after December 1, 1991.

Acceptance of a provider as a participant.

Outlines the process for CMS to accept a provider agreement, including notice of determination and signing requirements.

Decision to deny an agreement.

Specifies the bases for CMS to refuse a provider agreement, including fraud convictions, failure to disclose ownership, and civil rights non-compliance.

Effective date of agreement or approval.

Establishes the rules for determining the effective date of a Medicare provider agreement based on survey results, accreditation, and compliance with health and safety standards.

Change of ownership or leasing: Effect on provider agreement.

Defines what constitutes a change of ownership and the resulting impact on the existing Medicare provider agreement, including automatic assignment.

Scope of part.

Defines the scope of Part 489, identifying the types of providers subject to these requirements and the subparts governing agreements and limitations.

Basic commitments.

The provider agrees to the following:

Specific limitations on charges.

Providers are prohibited from charging Medicare beneficiaries for services covered by Medicare or for services where payment would be made if the provider had met specific administrative and documentation requirements.

Special provisions applicable to prepayment requirements.

Providers are prohibited from requiring prepayment for inpatient services, denying covered services due to inability to pay, or charging for admission or discharge conditions.

Specific limitation on charges for services provided to certain enrollees of fee-for-service FEHB plans.

Hospitals must accept a specific payment rate, approximating the Medicare prospective payment system rate, for inpatient services provided to certain retired Federal workers enrolled in fee-for-service FEHB plans.

Special responsibilities of Medicare hospitals in emergency cases.

This provision establishes the federal requirements for hospitals to provide medical screening examinations, stabilizing treatment, and appropriate transfers for individuals presenting with emergency medical conditions.

Special requirements concerning CHAMPUS and CHAMPVA programs.

Medicare-participating hospitals must participate in CHAMPUS and CHAMPVA programs and accept determined allowable amounts as payment in full for inpatient services.

Special requirements concerning veterans.

Medicare-participating hospitals must admit veterans authorized by the Department of Veterans Affairs and adhere to VA payment and admission standards.

Beneficiary notice of discharge or change in status rights.

Hospitals must provide Medicare beneficiaries with timely, required notices regarding discharge, termination of services, or changes in status.

Special capitalization requirements for HHAs.

Home Health Agencies must maintain initial reserve operating funds to qualify for Medicare billing privileges.

Special requirements concerning beneficiaries served by the Indian Health Service, Tribal health programs, and urban Indian organization health programs.

Hospitals must accept specific payment methodologies and rates for services provided to beneficiaries of Indian Health Service and related tribal programs.

Definitions.

Provides definitions for terms including immediate jeopardy, physician-owned hospital, and provider agreement for the purposes of provider agreements.

Allowable charges: Deductibles and coinsurance.

Specifies the allowable charges for Medicare Part A and Part B deductibles and coinsurance, including specific limitations for DME and insulin.

Allowable charges: Blood.

Limits the charges a provider may impose on a beneficiary for the first three pints of blood or packed red cells under Medicare.

Allowable charges: Noncovered and partially covered services.

Establishes rules for charging beneficiaries for services that exceed Medicare coverage, requiring prior notification of charges.

Allowable charges: Hospitals participating in State reimbursement control systems or demonstration projects.

Hospitals participating in state reimbursement control systems or demonstration projects may charge beneficiaries for noncovered services under specific conditions.

Notice to intermediary.

Providers must inform their Medicare intermediary of any amounts collected from a beneficiary or on their behalf.

Definition of incorrect collection.

This section defines incorrect collections as amounts collected from a beneficiary that are not authorized under the applicable subpart.

Timing and methods of handling.

Providers must promptly refund incorrect collections or set aside funds in a separate account if a refund cannot be made within 60 days.

Payment of offset amounts to beneficiary or other person.

CMS may pay offset amounts directly to a beneficiary if a provider fails to refund an incorrect collection after a written request.

Termination by the provider.

Providers must provide written notice to CMS to terminate their provider agreement, including specific requirements for public notice and facility closure.

Termination by CMS.

CMS may terminate a provider agreement for failure to comply with Medicare requirements, including specific provisions for emergency services and immediate jeopardy.

Termination by the OIG.

The OIG may terminate a provider agreement for false statements, excessive billing, or providing substandard care.

Exceptions to effective date of termination.

Specifies conditions under which Medicare payment continues for up to 30 days following a provider agreement termination for certain services and long-term care residents.

Reinstatement after termination.

Outlines the requirements for a provider to be reinstated into the Medicare program following a termination of their provider agreement.

Definitions.

Defines terms related to surety bonds, civil money penalties, and financial assessments specifically for home health agencies.

Basic requirement for surety bonds.

Mandates that home health agencies obtain a surety bond as a condition of Medicare participation.

Requirement waived for Government-operated HHAs.

Provides a waiver for surety bond requirements for home health agencies operated by government entities under specific conditions.

Parties to the bond.

Identifies the required parties to be named in a surety bond for home health agencies.

Authorized Surety and exclusion of surety companies.

Establishes criteria for authorized surety companies and the process for CMS to exclude unauthorized sureties.

Amount of the bond.

Details the calculation methods for determining the required amount of a surety bond for home health agencies.

Additional requirements of the surety bond.

Specifies the liability and coverage requirements for surety bonds issued to home health agencies.

Term and type of bond.

Home health agencies must obtain and maintain a surety bond as a condition of participation in Medicare, with specific requirements for bond terms, types, and submission timelines.

Effect of failure to obtain, maintain, and timely file a surety bond.

Failure by a home health agency to obtain, file, or maintain a required surety bond serves as grounds for CMS to terminate or refuse a provider agreement.

Evidence of compliance.

CMS may require home health agencies to provide evidence of compliance with surety bond requirements, and failure to do so may result in termination or denial of a provider agreement.

Effect of payment by the Surety.

Payments made by a surety to CMS under a bond for unpaid claims or penalties constitute collection of the debt and provide a basis for terminating the home health agency's provider agreement.

Surety's standing to appeal Medicare determinations.

A surety has standing to appeal Medicare determinations that the home health agency could appeal, provided specific jurisdictional and procedural conditions are met.

Effect of review reversing determination.

CMS will refund a surety if a determination that led to a bond payment is successfully appealed by the home health agency or the surety.

Effect of conditions of payment.

CMS will reimburse a surety if CMS subsequently collects from the home health agency on the same claim or penalty that triggered the surety's payment.

Incorporation into existing provider agreements.

Surety bond requirements are deemed incorporated into existing home health agency provider agreements.