The Appearance of Impropriety

We learned a new term today:  hospital-within-a-hospital (“HwH”).  This is where a separately licensed and certified hospital is co-located with another hospital. For example, El Paso Children’s Hospital would be considered a HwH because it is separately licensed and certified but is located at the same location as UMC.  Since how a hospital is licensed and certified affects the reimbursements that it gets, the Center for Medicare and Medicaid Services (CMS) has established some rules for HwH hospitals, specifically about separate control:

“CMS has long recognized the difference between ownership and control. In CMS’s view, separateness is established by control. If the host hospital is not in a position to directly or indirectly control the HwH, than the two hospitals are considered separate.” )http://murer.com/pdfs/articles/thecolocationequation.pdf).  This means that both hospitals must have a separate governing body, separate chief medical officer, separate medical staff and a separate CEO.  Specifically about the governing body:  “The HwH must have a governing body that is not under the control of the host hospital or a third party that controls both the host hospital and the HwH”.

Why do we bring this up?  Last night KVIA reported that Miguel Fernandez will be serving on the El Paso Children’s board AND the UMC board (you can read the article here).  Wouldn’t this violate the separate control requirement by CMS?  Sure, having 1 person on both boards may skirt the corners of this requirement.  However, given the tumultuous relationship between EPCH and UMC and the difficult year both hospitals have had, it would be advisable to avoid even the HINT of violating the CMS rules.  A misstep now could adversely affect all of those reimbursements that the County Commissioners keep talking about.

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