Provider-Based Status (340B)
Definition
Provider-based status is a Medicare designation that allows hospital outpatient departments to bill both a facility fee (under the hospital’s Medicare provider number) and a professional fee for services rendered. Hospitals seek provider-based status for financial reasons, as it enables higher total reimbursement for outpatient services.
In the 340B context, provider-based status is related to child site eligibility. For an offsite outpatient facility to qualify as a 340B child site, it must be listed as a reimbursable facility on the parent hospital’s Medicare cost report with associated outpatient costs and charges. Facilities with provider-based status that bill under the parent hospital’s Medicare provider number are more likely to meet this requirement.
However, provider-based status is not a guarantee of 340B child site eligibility, and not all 340B child sites need to have formal provider-based status. The key requirement is the Medicare cost report listing, not the provider-based designation itself.
Frequently Asked Questions
Why Provider-Based Status (340B) Matters
Understanding the relationship between provider-based status and 340B child site eligibility helps hospital systems evaluate which offsite facilities can be registered as child sites. Registering ineligible facilities is a compliance risk.
How Virtue 340B Uses It
Virtue 340B reviews provider-based status and Medicare cost report documentation as part of child site eligibility assessments for hospital-type covered entity clients.