CMS Publishes Final Rule on Medical Staff and Governing Boards

Health Law Alert

May 23, 2014
Health Law Alert

On May 12, 2014, the Centers for Medicare & Medicaid Services (CMS) published in the Federal Register the Final Rule to the Medicare Conditions of Participation (CoPs), including CoPs for medical staff and governing boards (79 FR 27105-27157).

The medical staff revisions were to clarify the May 16, 2012 Final Rule (77 FR 29061), which had required that each hospital must have its own independent medical staff. CMS received so many complaints as a result of this rule that it issued the 2014 CoPs to allow for a unified and integrated medical staff among multiple hospitals in a healthcare system. CMS stated in the Preamble that "[I]t is in the best interest of hospitals, medical staff members and patients to modify our proposed prohibition on the use of a unified and integrated medical staff for a multihospital system and its member hospitals so as to enable the medical staff of each hospital to voluntarily integrate itself into a larger system medical staff." As such, CMS listed the following requirements for a unified and integrated medical staff:

  1. A majority vote of the medical staff of each separate hospital in a multihospital system is required to either participate in or opt out of a unified and integrated structure.
  2. If a unified and integrated medical staff is adopted, it must have bylaws, rules and requirements that describe self-governance, appointment, credentialing, privileges and oversight processes for the integrated staff. In addition, a process must be developed for each hospital's medical staff to opt out of the unified and integrated staff through a majority vote.
  3. The unified and integrated medical staff is established in a manner that takes into account each member hospital's unique circumstances, patient population and patient population differences.
  4. The unified and integrated medical staff must develop policies and procedures addressing the needs and concerns of members of the medical staff of each separate hospital.

The second medical staff revision adopted by CMS relates to who may be a member of the medical staff. Under the May 16, 2012 Final Rule, CMS defined a medical staff as one composed of doctors of medicine or osteopathy and also allowed for other categories of non-physician practitioners, in accordance with state law and including scope-of-practice state laws. Subsequently, CMS received many comments concerning the ambiguous language of the 2012 Final Rule. As a result, CMS revised Section 482.22(a) to state that medical staffs must be composed of doctors of medicine or osteopathy, but in accordance with state law and scope-of-practice laws, the medical staff may also include other categories of physicians (such as doctors of podiatry, optometry, dental surgery and dental medicine), chiropractors, clinical psychologists, and non-physician practitioners determined to be eligible by the governing body for appointment to the medical staff, such as advanced practice nurses, physician assistants, registered dieticians and doctors of pharmacy.

With respect to the governing body CoPs, in the May 12, 2014 Final Rule, CMS removed the requirement that a medical staff member must serve on the governing board, replacing it with a requirement that the governing body directly consult with the individual responsible for the medical staff of a hospital or a designee periodically throughout the fiscal or calendar year (42 CFR 482.12 (a)(10)).

Notwithstanding the revisions in the 2014 Final Rule, in providing for a unified and integrated medical staff of a multihospital system, CMS emphasized that each separately participating hospital within the system is still required to comply with all other hospital CoPs.

Should you have any questions or need further information, please contact Douglass A. Marshall in our Peoria, Illinois office or your regular Hinshaw attorney

This alert has been prepared by Hinshaw & Culbertson LLP to provide information on recent legal developments of interest to our readers. It is not intended to provide legal advice for a specific situation or to create an attorney-client relationship.