On or after July 1, 2003, all hospitals face the loss of Medicare provider-based status for "grandfathered" outpatient departments and clinics. Loss of such status usually results in significantly lower reimbursements since providers can no longer submit both a technical component and a physician professional fee component.

At the same time, however, many hospitals are finding that their off-site clinic operations can qualify for Medicare provider-based status under the new regulations, which likely means increased reimbursement.

Our Firm has developed a program that can assist hospitals in both instances, to determine what may need to be done in order for grandfathered units to remain compliant—or if free-standing units are eligible for provider-based status—under the rigorous regulatory requirements, which became effective August 1, 2002.