title: The impact of consolidation on Medicare reimbursement. Mergers, acquisitions, and other types of consolidations involve a change in ownership that implies termination of Medicare participation for the consolidating providers.
abstract: In order to fully understand the ramifications of consolidations, mergers, and acquisitions on Medicare reimbursement issues, healthcare financial managers must be well versed in the nuances of governance and managerial control, legal and regulatory compliance, and reimbursement. For example, when consolidations occur, there may be a desire for more shared control of a consolidated organization than would result if assets were sold outright. In addition, three important legal and regulatory issues must be dealt with when consolidations occur: change of ownership rules, cost-reporting consistency rules, and capital PPS rules. Finally, the consolidation of two or more organizations under a single Medicare provider number has several ongoing effects on Medicare reimbursement. DRG standardized amount and area wage index, rural referral centers, sole community providers, disproportionate share hospitals, and medical education are five areas affected.
authors.affiliation: Ernst & Young LLP, Miami, FL, USA.
authors.forename: S J
authors.initials: SJ
authors.lastname: Davis
mesh_terms: D002201:Capital Expenditures; D003953:Diagnosis-Related Groups; D004503:Education, Medical, Graduate / Q000191:economics; D006273:Health Facility Merger / Q000191:economics* / Q000331:legislation & jurisprudence; D006782:Hospitals, Special / Q000191:economics; D006278:Medicare / Q000331:legislation & jurisprudence*; D009937:Organizational Objectives; D010067:Ownership / Q000191:economics*; D011907:Rate Setting and Review; D012017:Referral and Consultation; D012051:Reimbursement Mechanisms / Q000331:legislation & jurisprudence*; D019035:Rural Health Services / Q000191:economics; D014481:United States