Revised Physician Supervision Requirements Under the 2011 OPPS Final Rule

In the 2011 Hospital Outpatient Prospective Payment System Final Rule (2011 OPPS Final Rule), the Centers for Medicare and Medicaid Services (CMS) has relaxed somewhat the physician supervision requirements for hospital outpatient therapeutic and diagnostic services.  

CMS has long required hospitals to provide direct supervision for therapeutic services furnished to hospital outpatients incident to a physician service.  Prior to the 2011 OPPS Final Rule, the definition of direct supervision generally required the supervising physician (or other practitioner, as applicable) to be located on the hospital "campus" or "in the off-campus provider-based department" and immediately available to provide assistance throughout performance of the procedure.  In the 2010 OPPS Final Rule, CMS expanded the scope of the hospital "campus," allowing supervisors to be in non-hospital space on the campus, but it held firm on its strict supervision standards for off-campus departments.  That is, for off-campus provider-based departments, this meant that the supervisor had to be present in the physical space identified in the cost report for that specific provider-based department.  Accordingly, a supervisor could not be located in adjacent non-hospital space, such as a private medical office, even if it was only feet away.

Effective January 1, 2011, CMS will amend the definition of direct supervision to relax its rigid requirements surrounding the physical location of a supervising physician or practitioner for off-campus outpatient services.  The new definition removes all references to "on the same campus" or "in the off-campus provider-based department" of the hospital, and it focuses strictly on the requirement that the supervising physician be "immediately available":

For services furnished in the hospital or CAH, or in an outpatient department of the hospital or CAH, both on and off-campus…‘direct supervision' means that the physician or nonphysician practitioner must be immediately available to furnish assistance and direction throughout the performance of the procedure. It does not mean that the physician or nonphysician practitioner must be present in the room when the procedure is performed.

CMS, CY 2011 OPPS Final Rule,  75 Fed. Reg. 71800, 72259 (Nov. 24, 2010) (to be codified at 42 C.F.R. § 410.27(a)(1)(iv)) (emphasis added).  As defined in the preamble, immediately available means "physically present, interruptible, and able to furnish assistance and direction throughout the performance of the procedure but without reference to any particular physical boundary."  Id. at 72008.  CMS reiterated that it is not sufficient for the supervisor to be available by phone.  Id. 

CMS has adopted the same new definition of direct supervision and immediate availability for outpatient diagnostic services as well, except for diagnostic services performed "under arrangement in non-hospital locations."  Id. at 72013.  For such services, CMS still requires the supervisor to be physically present in the office suite and immediately available.

On the whole, although the definition of "immediately available" does not provide specific parameters for time or distance, CMS has given hospitals more flexibility in providing direct supervision of outpatient services furnished in off-campus departments, including the ability to have a supervisor in adjacent non-hospital office space.  More specifically, supervising physicians and non-physician practitioners no longer need to remain within the walls of an off-campus provider-based department in order meet the new definition of direct supervision.