Medicare Conditions of Participation: Facility Guide and FAQ

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Written by Alexa Davidson, MSN, RN Content Writer, IntelyCare
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Reviewed by Katherine Zheng, PhD, BSN Content Writer, IntelyCare
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When you oversee the operations within a healthcare organization, keeping up with all the regulatory standards you need to be in compliance with is an ongoing challenge. The Centers for Medicare and Medicaid Services (CMS) is one major source for health and safety standards that participating healthcare facilities must follow to ensure compliance.

Learn about the Medicare conditions of participation that allow your facility to participate in federal reimbursement programs. Here, we’ll cover what you need to know about the conditions and how they affect your facility.

What Are Conditions of Participation?

Healthcare facilities must meet health and safety standards to begin and continue participating in Medicare and Medicaid programs. These standards are called Conditions of Participation (CoPs) and Conditions for Coverage (CfCs). The conditions are in place to ensure that patients get the highest quality care possible.

Medicare providers and suppliers must abide by CMS CoP standards to receive reimbursement. Examples of CMS providers are hospitals, home health, hospices, and nursing homes. A supplier includes facilities delivering therapeutic services, such as physical and speech therapy, and diagnostic centers.

The following table outlines the types of healthcare organizations that must abide by Medicare conditions of participation.

CMS Participating Organizations
Ambulatory surgery centers Hospitals and hospital swing beds Programs for individuals with intellectual disabilities
Community mental health Long-term care facilities Psychiatric hospitals
Critical access hospitals Organ procurement organizations Rehabilitation, physical therapy, or speech therapy clinics
End-stage renal disease centers Organizations for the elderly Religious nonmedical healthcare institutions
Home health agencies Outpatient rehab Rural health clinics
Hospices Portable X-Ray suppliers Transplant centers

Why Were CoPs Established?

When Medicare was passed in 1965, the Social Security Act stated hospitals must meet specific criteria to receive reimbursements. The act gave the Department of Health and Human Services (HHS) authority to impose additional criteria to protect Medicare beneficiaries. These guidelines, which became known as CMS conditions of participation, underwent a major revision in 1986 and continue to inform health and safety standards in healthcare today.

Guidelines cover a range of categories, for example, a hospital conditions of participation list includes guidelines for areas such as:

  • Compliance with local, state, and federal laws
  • Emergency preparedness
  • Physical environment
  • Patients’ rights
  • Nurse staffing
  • Medical records
  • Lab and radiological services
  • Utilization review

Within each condition, there’s a set of standards elaborating on the specifics of a given category. For example, within the “surgical services” condition, there are standards for organization and staffing and the delivery of services. CMS also has a set of conditions for skilled nursing facilities (SNFs) and nursing facilities (NFs) with their related quality standards. Every condition must be met for a facility to participate in Medicare programs.

How Are CoPs Regulated?

The most common way for a hospital to get verified is to obtain “deemed” status from a CMS-approved accreditation organization. By partnering with an organization such as the Joint Commission (TJC), a hospital accepts accountability for safety standards, which are audited at unannounced site visits.

Accreditation programs are completely voluntary — and of the 7,000 hospitals participating in Medicare programs, about one-fourth do not undergo accreditation. Instead, they must meet the minimum health and safety standards to operate as Medicare facilities. This involves getting CMS certified by proving they meet the conditions of participation.

Who Verifies Conditions of Participation?

Medicare conditions of participation are verified during unannounced compliance audits. These surveys may be performed by state survey agencies or a CMS-approved accrediting organization. At a visit, surveyors verify whether a facility meets the necessary standards of quality and safety for their patients.

Accreditation agencies have the authority to issue “deemed” status, which means a healthcare facility meets or exceeds Medicare standards established in the conditions of participation. In addition to the Joint Commission, other CMS-approved accreditation organizations include:

What Happens if CoPs Aren’t Met?

It’s important for providers to understand and comply with Medicare conditions of participation in order to ensure they receive payment for their services. Failure to comply can result in sanctions including fines, increased reporting requirements, or even exclusion from the program. The procedure for corrective actions can be found in the State Operations Manual, which guides state survey agencies and CMS Regional Office representatives.

CMS may terminate an agreement with a healthcare provider due to:

  • Noncompliance with the terms of the agreement
  • A failure to provide detailed information regarding payments
  • Refusal to hand over fiscal or medical records for claims verification
  • Disallowance of photocopying of records to verify compliance

Are You Up-To-Date on the Latest Healthcare Regulations?

Having a clear understanding of compliance standards like the Medicare conditions of participation is essential to operating a healthcare facility. Don’t miss out on the latest updates on the healthcare industry when you subscribe to IntelyCare’s free newsletter.

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