QUESTION:        We are in the process of buying a Medicare provider. Can you provide any guidance on Medicare’s Change of Ownership (“CHOW”) process?

ANSWER:             Yes. Medicare has made it practically impossible to acquire any provider without assuming that provider’s Medicare Provider Number. As a result, you will have to follow Medicare’s CHOW process.

The CHOW process requires both the Seller and the Buyer to complete a CMS Form 855-A for each Medicare Provider Number. (It is not unusual for one provider to have several Medicare Provider Numbers.) You will also need to obtain a new NPI number that will correspond to each Medicare Provider Number.

The Buyer and the Seller’s completed Forms, 855-A, with all attachments, must be sent to the Medicare Contractor. Please be sure to provide all information requested in the required format. When they ask for a zip code +4 or the date in an mm/dd/year format, they mean it! If you have to provide any supplemental information, then you also have to have a new certification statement (Section 15 of Form 855-A) signed and dated by an “Authorized Official.” An “Authorized Official” is defined in the 855-A as an individual who has the authority to make the changes in that submission and to commit the Buyer to fully abide by the statutes, regulations and program construction of the Medicare Program.

Once the Medicare carrier approves the application, it will be sent to CMS’s Regional Office for their review and comment. Once approved, the Regional Office will issue an approval to the provider, the Medicare Contractor and the State.

This process takes time, so plan accordingly. Also since the Buyer will be assuming the Seller’s provider number, the acquisition agreement should address the rights of the Buyer in the event of an overpayment that was caused by the Seller’s pre-closing operation of the provider but is not discovered until after the Closing Date.

Did you notice how many of this week’s cases involved employed physicians? We did!

Please join Henry, Charlie and Rachel in Las Vegas on October 15-17 for the Institute on Employed Physicians and Their Impact on the Medical Staff.