Department of Health and Human Services 
OFFICE OF 
 
INSPECTOR GENERAL 
 
 
 
 
 
 
 
 
S P
 ERVICES  ROVIDED BY 
 
C A
  RITICAL  CCESS 
 
H 2011 
OSPITALS IN 
 
Stuart Wright  
Deputy Inspector General for 
Evaluation and Inspections 
 
December 2013 
OEI-05-12-00081   
   
EXECUTIVE SUMMARY:  SERVICES PROVIDED BY CRITICAL ACCESS 
HOSPITALS IN 2011 
OEI-05-12-00081 
 
WHY WE DID THIS STUDY 
The Critical Access Hospital (CAH) certification was created to ensure that rural beneficiaries 
are able to access hospital services.  For most services provided, Medicare reimburses CAHs at 
101 percent of their costs rather than at the rates set by the prospective payment systems or fee 
schedules. In 2011, Medicare and beneficiaries paid approximately $8.5 billion for services 
provided at CAHs. 
 
CAHs are required to provide broad classes of services, including inpatient and outpatient 
services, but have latitude in what specific types of services they provide.  They can also 
provide optional services such as swing bed services, which are the equivalent of skilled 
nursing services. 
 
The purpose of this report is to aid policymakers and regulators as they consider the future role 
of CAHs in the delivery of hospital services.  The Office of Inspector General has 
recommended that policymakers reevaluate which facilities are certified as CAHs.  In addition, 
the Administration has proposed to decertify some CAHs and change how remaining CAHs are 
paid. 
 
HOW WE DID THIS STUDY  
We analyzed 2011 enrollment data; inpatient and outpatient claims data; and cost report data to 
determine what types of services CAHs provided and the extent to which Medicare and other 
patients utilize these services.  To provide perspective, we compared services and service 
utilization at CAHs to that within acute-care hospitals, broken out by hospital size.  
 
WHAT WE FOUND 
In 2011, CAHs provided outpatient services and, to a lesser extent, inpatient services to 
approximately 5 percent of all Medicare beneficiaries.  At CAHs, more than eight times as 
many Medicare beneficiaries visited outpatient departments as visited inpatient departments.  
Compared to beneficiaries who received care at acute-care hospitals, a slightly higher 
percentage of beneficiaries who received services at CAHs received outpatient services.  The 
outpatient services provided by CAHs were from a wide array of hospital departments.  
Laboratory services were the most commonly provided outpatient service at both CAHs and 
acute-care hospitals.  
 
CAHs inpatient beds, which are limited to a maximum of 25 at each CAH, were not heavily 
utilized. In 2011, patients used approximately one of every five available CAH inpatient beds.  
When Medicare beneficiaries did receive inpatient services at CAHs, the services provided did 
not often include operating-room procedures.  In addition, more CAHs used their inpatient beds 
for swing-bed services (i.e., services that beneficiaries would receive in a skilled nursing 
facility, such as nursing care and rehabilitative therapies) than did all acute-care hospitals.  On 
average, CAHs used 10 percent of their available inpatient beds to provide swing-bed services, 
while acute-care hospitals used 4 percent of their available inpatient beds. 
   
   
 
TABLE OF CONTENTS 

 
Objectives ....................................................................................................1 

Background..................................................................................................1 

Methodology................................................................................................5 

Results..........................................................................................................8 

Medicare Beneficiaries Used CAHs Primarily for Outpatient 

Services............................................................................................8 

Patients Used Approximately One of Every Five Available CAH 

Inpatient Beds ..................................................................................9 

CAHs Reported Providing Inpatient and Outpatient Services from 
 
a Wide Array of Hospital Departments ..........................................15 

Most CAHs Provided Swing-Bed Services ...................................17 

Few CAHs Had Distinct-Part Units...............................................18 

Most CAHs Received Between $1 Million and $10 Million in 

Medicare Payments for Services Provided ....................................19 

Conclusion .................................................................................................21 

Appendixes ................................................................................................22 

Appendix A:  Detailed Methodology.............................................22 

Appendix B: Distribution of CAHs across All States ...................24 

Acknowledgments......................................................................................25 

 
 
Tables 

Table 1: Number of Medicare Beneficiaries Who Visited Inpatient
  
and Outpatient Departments at CAHs and Acute-Care Hospitals ...8 

Table 2: CAHs Most Frequently Provided Types of Outpatient 

Services............................................................................................9 

Table 3: Bed Utilization Rates at CAHs and Acute-Care   

Hospitals ........................................................................................10 

Table 4: MS-DRGs For  Which CAHS Most Frequently Billed ...13 

   
   
Table 5: Departments in Which More Than 60 Percent of CAHs 

Provided Services...........................................................................16 

Table 6: Departments in Which Fewer Than 50 Percent of CAHs 

Provided Services...........................................................................17 

Table 7: CAHs Swing-Bed Utilization Rates ...............................18 

Table 8: Distinct-Part Units at CAHs ............................................18 

Table 9: Mean, Median, and Range of Medicare Payments to 

CAHs..............................................................................................20 

 
 
Charts 

Chart 1: Medicare Beneficiaries  Utilization of Inpatient Services 

at CAHs and Acute-Care Hospitals ................................................11 
 
Chart 2: Sources of Inpatient Admissions at CAHs and Acute-Care 

Hospitals ........................................................................................12 

Chart 3: Percentages of Surgical and Medical MS-DRGs For
  
Which CAHs and Acute-Care Hospitals Billed Medicare .............14 

Chart 4: CAH Patients  Average Lengths of Stay .........................14 

Chart 5: Distribution of Medicare Payments to CAHs  .................19 

 
 
   
   
 
OBJECTIVE 
To provide information for policymakers to consider while reassessing 
how Critical Access Hospitals (CAHs) should be certified and paid, 
including: 
a. 	  the types of services provided at CAHs in 2011; 
b. 	  how the types of services provided at CAHs in 2011 compared to 
the types of services provided at acute-care hospitals in 2011; and  
c. 	  how much Medicare paid for services provided at CAHs in 2011. 
BACKGROUND 
The purpose of this report is to aid policymakers as they consider the 
future role of CAHs in the delivery of hospital services.  The Office of 
Inspector General (OIG) has recommended that policymakers reevaluate 
which facilities are certified as CAHs.  In addition, the Administration has 
proposed to decertify some CAHs and change how remaining CAHs are 
paid. 
Critical Access Hospitals 
In 1997, the Balanced Budget Act created the CAH certification to ensure 
that hospital care is accessible to beneficiaries in rural communities.1, 2   
The CAH certification replaced designations for several other types of 
rural hospitals, including the essential access community hospital, the 
rural primary care hospital, and the Montana medical assistance facilities, 
all of which had similar features.3  Hospitals that meet specific 
requirements can qualify for the CAH certification and receive favorable 
Medicare reimbursements.   
In 2011, 1,329 CAHs were located in 45 States.  These CAHs were 
predominantly located in small, rural towns, with most owned by 
nonprofit organizations such as private nonprofit companies; local hospital 
 
1 Balanced Budget Act (BBA)  of 1997, P.L. 105-33  4201.  The BBA amended  several 
sections  of the Social Security Act, including sections 1820, 1861(mm), 1814(l), and  
1834(g).    
2 Centers for Medicare & Medicaid Services (CMS), State Operations Manual, 
Pub. No. 100-07, ch. 2,  2254A.  Accessed at http://cms.gov/Regulations-and-
Guidance/Guidance/Manuals/Internet-Only-Manuals-IOMs.html (chapter-specific URL:  
http://cms.gov/Regulations-and-Guidance/Guidance/Manuals/Downloads/ 
som107c02.pdf)  on July 7, 2011. 
3 MedPAC, Report to the Congress:  Medicare in Rural America,  June 2001.  Accessed 
at http://www.medpac.gov/documents/jun01%20entire%20report.pdf on  
September 27,  2013.  
Services Provided by Critical Access Hospitals in 2011 (OEI-05-12-00081)   1 
   
   
districts or authorities; and Federal, State, and local governments.  Nearly 
40 percent of these CAHs were located in seven States, including Illinois, 
Iowa, Kansas, Minnesota, Nebraska, Texas, and Wisconsin.  See 
Appendix A for a map detailing the number of CAHs in each State.  
In 2011, there were approximately 49 million Medicare beneficiaries.4   
CAHs served approximately 5 percent, or 2.3 million, of these 
beneficiaries, including 2 percent who received hospital services only at 
CAHs and 3 percent who received hospital services at both CAHs and 
acute-care hospitals.  Medicare and beneficiaries paid approximately 
$8.5 billion for services provided at CAHs. 
Medicare Payments to CAHs  
CMS pays CAHs under a different payment system than most acute-care 
hospitals. CAHs receive 101 percent of their reasonable costs for most 
services provided. 5, 6  CMS determines these costs using information from 
CAHs cost reports.7  CMS pays most acute-care hospitals using inpatient 
and outpatient prospective payment systems (IPPS and OPPS), which pay 
predetermined rates for treating beneficiaries.8, 9 Inpatient services are 
paid for based on the patients diagnoses, while outpatient services are 
paid for based on the services provided. 
Like other Medicare beneficiaries, beneficiaries who receive services at  
CAHs are responsible for paying a deductible and coinsurance for some  
outpatient services, such as office and emergency room visits and minor 
procedures.10  Coinsurance for outpatient services provided at CAHs is 
typically equal to 20 percent of the reasonable charges.11 Medicare 
beneficiaries generally do not pay coinsurance for other outpatient 
services, such as laboratory services and certain preventive outpatient  
services.12    
   
 
4 CMS, The Medicare and Medicaid Statistical Supplement, 2012  Edition.   Accessed at 
http://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-
Reports/MedicareMedicaidStatSupp/2012.html  on August 27, 2013. 
 
5 Social Security Act,  1814(l) and 1834(g), 42  U.S.C.   1395(l) and  1395m(g). 

6 Reasonable costs are the direct and indirect costs associated with providing services 

to Medicare beneficiaries.  42 CFR  413.9(b)(1). 

7 Cost reports are annual reports submitted by  providers to Medicare that list providers 

costs and charges for delivering healthcare services.  

8 Social Security Act,   1886(d) and  (g), 42  U.S.C.   1395ww(d) and (g).  

9 Social Security Act,   1833, 42 U.S.C.  1395l. 
 
10  Social Security Act,  1866(a)(2)(A),  42 U.S.C.  1395cc(a)(2)(A). 

11 Ibid. 

12 Social Security Act,   1833(a)(1), 42 U.S.C.  1395l(a)(1). 
  
Services Provided by Critical Access Hospitals in 2011 (OEI-05-12-00081)   2 
   
   
Medicare Requirements for CAH Certification 
Facilities must meet the requirements set forth in the CAH Conditions of 
Participation to receive the CAH certification.  Conditions of Participation  
are health-, safety-, and location-related requirements that facilities must 
meet to participate in the Medicare program as CAHs.  CAH Conditions 
of Participation include being located (1) in rural areas and (2) at a certain  
distance from other hospitals or CAHs (hereinafter referred to collectively 
as the location requirements); having 25 or fewer beds used for inpatient 
care or swing bed services; and having an average length of patient stay 
that does not exceed 96 hours (hereinafter referred to as the 4-day 
requirement).13, 14, 15  
Maintaining CAH Certification 
CAHs are subject to periodic reassessments of their compliance with the 
CAH Conditions of Participation.   CMS staff report that the current 
practice is to complete these reassessments every 3 years on average.  For 
CAHs to maintain their certifications, CMS or a CMS-approved Medicare 
CAH accreditation program must verify that the CAHs continue to meet 
all CAH Conditions of Participation.16  
CAH Services  
CAHs are required to provide inpatient and outpatient services but have 
latitude in the specific services they provide.  These services can include 
surgical, medical, and diagnostic services.17 Surgical services include 
operating-room procedures, like appendectomies and joint replacements.  
Medical services include all treatment services other than operating-room 
procedures, like the treatment of concussions or kidney stones.  Diagnostic 
services, like imaging and laboratory services, are used to diagnose 
diseases. CAHs can also provide other types of services used to facilitate 
medical, surgical, and diagnostic services, such as ambulance services.   
Beyond inpatient and outpatient services, CAHs can also provide 
swing-bed services. Swing-bed services are equivalent to services that a 
 
13 Social Security Act,   1820(c)(2), 42 U.S.C.  1395i-4(c)(2); CMS,  State Operations 
 
Manual, Pub. No. 100-07,  ch. 2,  2256F.  Accessed online on  July  7, 2011; for URL 

details, see footnote 2. 
 
14 42 CFR   485.620(a).  A swing  bed is a CAH bed that is reimbursed for skilled 
 
nursing services. 

15 42 CFR   485.620(b). 

16 CMS, State Operations  Manual, Pub. No. 100-07, ch. 2,   2021A and 2022B. 
 
Accessed online on July 7,  2011;  for URL details, see footnote 2.
  
17 42 CFR   485.635; CMS, State Operations Manual, Pub. No. 100-07,  Appendix W. 
  
Accessed at http://cms.gov/Regulations-and-Guidance/Guidance/Manuals/Internet-Only-

Manuals-IOMs.html (appendix-specific URL:   http://cms.hhs.gov/Regulations-and-
Guidance/Guidance/Manuals/downloads/som107ap_w_cah.pdf) on July 7,  2011. 

Services Provided by Critical Access Hospitals in 2011 (OEI-05-12-00081)   3 
   
   
beneficiary would receive in a skilled nursing facility, such as nursing care 
and rehabilitation therapies. 18,19    
Finally, CAHs can also provide inpatient services in distinct-part 
psychiatric and rehabilitation units.20 Distinct-part psychiatric and 
rehabilitation units (hereinafter referred to collectively as distinct-part 
units) are inpatient units that are certified separately by Medicare and are 
distinct from CAHs other inpatient operations.21   
CMS pays CAHs differently for services provided in distinct-part units 
than it does for services provided in other units at CAHs.  Unlike CAH 
inpatient, outpatient, and swing-bed services, which Medicare reimburses 
at 101 percent of cost, Medicare reimburses services provided in 
distinct-part rehabilitation and psychiatric units at the rates set by the IPPS 
for rehabilitation facilities and psychiatric facilities, respectively.22     
Proposed CAH Changes  
Medicare payments to CAHs have come under increased scrutiny as part 
of ongoing deficit-reduction discussions.  In September 2011, the 
Administration published its Plan for Economic Growth and Deficit 
Reduction.2 3   The Plan proposed reducing CAH reimbursements to 
100 percent of reasonable costs and eliminating the critical access 
certification for CAHs located fewer than 10 miles from another hospital.24   
The Administrations proposed budget for fiscal year 2014 made the same 
recommendations and estimated the savings over 10 years to be 
$1.4 billion from reducing reimbursement from 101 percent of reasonable 
costs to 100 percent, and $690 million from eliminating the critical access 
certifications of CAHs located fewer than 10 miles from another 
hospital.25    
Related Work 
In August 2013, OIG issued a report that focused on how many CAHs 
would meet the location requirements if required to re-enroll in Medicare.  
 
18 42 CFR   485.645.  

19 42 CFR   409.20(a). 

20 42 CFR   485.647.  

21 CMS, Medicare Claims Processing Manual,  Pub. No. 100-4, ch. 3,   30.1.  Accessed 

at http://cms.gov/Regulations-and-Guidance/Guidance/Manuals/Internet-Only-Manuals-
IOMs.html (chapter-specific  URL:   http://cms.gov/Regulations-and-Guidance/Guidance/ 

Manuals/Downloads/clm104c03.pdf)  on July 30, 2013. 

22 42 CFR   413.74(e);  42 CFR  pt. 412, subpts. N and P. 
 
23 Office of Management and Budget (OMB), Living Within Our  Means  and Investing in
  
the Future:  The Presidents Plan for Economic Growth and  Deficit Reduction, 

September 2011.  Accessed at http://www.whitehouse.gov/sites/default/files/omb/budget/ 
 
fy2012/assets/jointcommitteereport.pdf on  October 24, 2011. 
 
24  Ibid., p. 36. 

25 OMB, Fiscal Year 2014  Budget  of  the U.S. Government,  p. 196, 2013.  

Services Provided by Critical Access Hospitals in 2011 (OEI-05-12-00081)   4 
   
   
OIG found that 64 percent of CAHs would not have been able to do so, 
and that Medicare and beneficiaries could realize substantial savings if 
CMS de-designated some of these CAHs and recertified them as acute-
care hospitals.26  OIG recommended that CMS seek legislative authority to 
assess whether existing CAHs should retain their critical access 
certifications. In addition, OIG recommended that CMS seek legislative 
authority to revise the CAH conditions of participation to include 
measures of whether CAHs serve beneficiaries who would otherwise be 
unable to reasonably access hospital services.  These criteria could be used 
to further evaluate a hospitals CAH certification in cases where the 
hospital did not meet the current requirements related to its location.  CMS 
concurred with the first recommendation but did not concur with the 
second. 
Additionally, OIG is conducting a nationwide review of the coinsurance 
that Medicare beneficiaries paid for outpatient services received at CAHs.   
Finally, OIG is conducting a nationwide review of swing-bed services at 
CAHs.27  The review compares the reimbursement for swing-bed services 
at CAHs to the reimbursement for the same level of care obtained at 
skilled nursing facilities for 20052010. 
METHODOLOGY 
This study provides descriptive information about CAHs nationwide in 
2011.  We analyzed 2011 enrollment data, inpatient and outpatient claims  
data, and cost report data. Our purpose was to determine where CAHs 
were located, who received services at CAHs, what types of entities 
owned CAHs, how much Medicare paid CAHs, and what types of 
inpatient and outpatient services CAHs provided.   
In some cases, we also compared CAHs to acute-care hospitals.  When 
comparing CAHs to acute-care hospitals, we frequently categorized 
acute-care hospitals into three groupings based on their size:  small (fewer 
than 100 beds), medium-sized (between 100399 beds), and large (400 or 
more beds).28  The term acute-care hospitals does not include 
psychiatric, rehabilitation, long-term care, and childrens hospitals, 
because these hospitals have operations distinct from CAHs.   
 
26 OIG,  Most Critical Access Hospitals Would Not Meet the Location Requirements If 
Required  To Re-Enroll in Medicare, OEI-05-12-00080, August  2013. 

27 OIG,  U.S. Department  of Health and Human Services Office of Inspector  General
  
Work Plan:   Fiscal  Year 2013, Part I, p. 7.  Accessed at https://oig.hhs.gov/reports-and-
publications/archives/workplan/2013/Work-Plan-2013.pdf on  September 23, 2013.   

28 We used  the American  Hospital Associations definitions of hospital size to establish 
 
the three groupings.  American Hospital Association,  Glossary,  2012.  Accessed at 

http://www.ahadataviewer.com/glossary/ on June  13, 2013. 

Services Provided by Critical Access Hospitals in 2011 (OEI-05-12-00081)   5 
   
   
We did not assess CAHs compliance with any Conditions of 
Participation.  An earlier OIG report did assess whether CAHs would meet  
some of the Conditions of Participationspecifically, the location 
requirementsin 2011.29    
Data Sources  
Certification and Survey Provider Enhanced Reports (CASPER) database. 
The CASPER database includes data generated from certification surveys 
and includes information such as provider addresses and type of 
ownership. We used the CASPER database to identify the 1,329 CAHs 
and 3,547 acute-care hospitals included in this study.  We also used the 
CASPER database to determine the addresses for all CAHs.   
2011 National Claims History (NCH) inpatient and outpatient files.   The 
2011 NCH inpatient and outpatient files contain the final inpatient and 
outpatient claims data submitted by hospital providers for Medicare 
reimbursement.  The 2011 NCH files include data only for Medicare 
beneficiaries. Although CAHs are not paid under a prospective payment 
system, the NCH inpatient file contains the applicable Medicare severity 
diagnosis related groups (MS-DRGs) based on information submitted on 
the claim.  We used the MS-DRG present on the claim in our analysis, and 
hereinafter refer to the inpatient services provided to CAH inpatients as 
MS-DRGs. 
Fiscal Year (FY) 2010 and 2011 hospital cost reports.   Hospitals are 
required to file annual cost reports with CMS.  Hospital cost reports 
contain provider information such as facility characteristics and annual 
costs, and they include data for all hospital patients.  We used 
2010 hospital cost report data whenever 2011 hospital cost report data was 
not available on CMSs Healthcare Provider Cost Reporting Information 
System.30  
   
 
29 OIG,  Most Critical Access Hospitals Would Not Meet the Location Requirements If 
Required  To Re-Enroll in Medicare, OEI-05-12-00080, August  2013. 
30 CMS, Cost Reports, July 25,  2013.  Accessed at http://www.cms.gov/Research-
Statistics-Data-and-Systems/Files-for-Order/CostReports/Cost-Reports-by-Fiscal-
Year.html on July 30, 2013. 
Services Provided by Critical Access Hospitals in 2011 (OEI-05-12-00081)   6 
   
   
Data Analysis  
Grouping acute-care hospitals by size. To classify acute-care hospitals by 
size, we used number of inpatient beds each hospital reported on its most 
recent cost report.  Of the 3,547 acute-care hospitals included in this study, 
we classified 1,290 as small, 1,770 as medium-sized, and 380 as large.  
We did not classify the remaining 107 acute-care hospitals because a cost 
report was not available or the cost  report did not have information about 
the number of inpatient beds. 
Services provided by CAHs and acute-care hospitals. To describe the 
types of services provided by CAHs and acute-care hospitals, we used the 
inpatient and outpatient claims data and cost report data.  Appendix A 
provides a detailed description of our analysis methods, cross-referenced 
to the corresponding table or chart in our results. 
Medicare payments for CAH services. To determine the amounts that 
Medicare paid for services provided at CAHs, we used the inpatient and 
outpatient claims data.  To determine the total Medicare payment for each 
service, we summed the amount paid by Medicare and the amount paid by 
the beneficiary in the form of deductible or coinsurance.  We then 
summed total payments for each CAH, and determined the percentage of 
each CAHs total Medicare payments that came from inpatient services, 
outpatient services, and swing-bed services.  
Limitations 
Our analysis that used hospital cost  report data does not account for the 
entire CAH and acute-care hospital population as some of these hospitals 
are not represented in the data. There were 51 CAHs and 208 acute-care 
hospitals that did not have 2011 cost report data.  We were able to 
incorporate 33 of these CAHs and 130 of these acute-care hospitals into 
our analyses by using their 2010 cost report data.  However, neither 
2011 nor 2010 cost report data were available for 18 CAHs and 
78 acute-care hospitals. To identify those instances where our analyses do  
not include all CAHs or hospitals, all tables and charts include listings of 
sample sizes and data sources.  
Additionally, we analyzed cost report data as reported by hospitals to 
CMS. This data may include figures reported in error; we did not perform  
tests designed to determine the reliability of the data.   
Standards 
This study was  conducted in accordance with the Quality Standards for 
Inspection and Evaluation issued by the Council of the Inspectors General 
on Integrity and Efficiency. 
  
Services Provided by Critical Access Hospitals in 2011 (OEI-05-12-00081)   7 
   
   
RESULTS 
 
Medicare Beneficiaries Used CAHs Primarily for Outpatient 
Services 
At CAHs, more than eight times as many Medicare beneficiaries visited 
outpatient departments as visited inpatient departments.  Approximately 
2.3 million beneficiaries visited CAHs in 2011.  More than 99 percent of  
these beneficiaries visited outpatient departments.  Conversely, 
approximately 12 percent of all beneficiaries who visited CAHs in 
2011 visited the CAHs inpatient departments.31    
Similarly, most Medicare beneficiaries who received services at acute-care 
hospitals visited outpatient departments.  However, compared to 
beneficiaries who received services at acute-care hospitals, a higher 
percentage of beneficiaries who received services at CAHs received 
outpatient services. Table 1 describes the frequency with which 
beneficiaries visited CAH and acute-care hospital inpatient and outpatient 
departments in 2011. 
 
Table 1: Number of Medicare Beneficiaries Who Visited Inpatient and Outpatient  
Departments at CAHs and Acute-Care Hospitals  
Average number  of 
Number of   Percentage of  
Medicare beneficiaries per 
Type of hospital   Department  visited   Medicare  Medicare 
beneficiaries  beneficiaries*   CAH or acute-care 
hospital 
All visits   2,329,674  1,753  
   
CAHs (n = 1,329)  Inpatient department  282,584  12%  213 
 
Outpatient department  2,316,675  99%  1,743  
 
All visits  4,850,351  3,760  
Small hospitals    
  Inpatient department  903,862  19%  701 
(n = 1,290) 
 
Outpatient department  4,562,533  94%  3,537  
 
All visits  16,602,499  9,380  
Medium-sized 
 
hospitals  Inpatient department  5,197,601  31%  2,936  
 
(n = 1,770) 
 
Outpatient department  14,530,420  88%  8,209  
 
All visits  9,673,498  25,457 
Large hospitals   
  Inpatient department  2,990,587  31%  7,870 
(n = 380) 
 
Outpatient department  8,334,349  86%  21,932 
Source:  OIG analysis of NCH outpatient  claims  files, 2013. 
* See footnote 31.  
 
31 The overlap in percentage is attributable to the fact that some beneficiaries received 
both inpatient  and outpatient  services.  
Services Provided by Critical Access Hospitals in 2011 (OEI-05-12-00081)   8 
   
   
CAHs provided outpatient services that were also commonly provided by 
acute-care hospitals. The outpatient services that CAHs provided 
Medicare beneficiaries were similar to those provided by acute-care 
hospitals. Table 2 presents the types of services that CAHs provided most 
frequently to Medicare beneficiaries in 2011 and includes listings of where 
those types of services rank in frequency relative to other types of 
outpatient services provided at acute-care hospitals.32  
 
Table 2: CAHs Most Frequently Provided Types of Outpatient  Services  
CAHs (n = 1,329)  Acute-care hospitals (n = 3,547)  
Type of service   Number of times service  Number of times service was 
Ranking   Ranking 
was provided   provided  
Laboratory services  1  27,685,701   1  863,400,271,981  
Minor procedures  2  5,708,563   2  122,803,730,011  
Standard imaging   3  3,130,118   3  101,639,705,004  
Other services  4  2,670,140   4  95,709,588,710  
Office visits  5  1,738,412   5  53,836,968,851  
Emergency room  visits   6  1,571,794   6  44,011,438,663  
Other tests  7  1,343,317   7  41,871,350,888  
Specialist services  8  883,244   10  14,233,675,446  
Advanced imaging  9  844,236   8  34,817,749,217  
Ultrasound/echography  10  484,898   9  19,440,571,950  
Source:  OIG analysis of NCH outpatient  claims  files, 2013. 
 
 
Patients Used Approximately One of Every Five Available CAH 
Inpatient Beds 
Patients used 21 percent of CAHs available bed days in 2011.  Available 
bed days are the total number of inpatient beds in a hospital multiplied by  
the number of days in a year.  Bed utilization rates represent the 
percentage of hospital bed days occupied over a set period.   
Patients utilization of CAHs available bed days was far less than at 
acute-care hospitals.  Small acute-care hospitals had the lowest average 
bed utilization rate of all acute-care hospitals.  However, CAHs average 
bed utilization rate of 21 percent was still lower than the 37 percent 
average bed utilization rate at small acute-care hospitals.  Table 3 presents  
CAHs and acute-care hospitals average number of beds, their average 
 
32 Because CAHs most frequently provided types of outpatient services closely aligned 
with those most frequently provided by acute-care hospitals, we did not divide acute-care  
hospitals into the three groupings based on  hospital size.  
Services Provided by Critical Access Hospitals in 2011 (OEI-05-12-00081)   9 
   
   
total available bed days, their average total inpatient bed days used by all 
CAH patients, and CAHs and acute-care hospitals annual average bed 
utilization rates in 2011.33 These figures include general inpatient stays 
and exclude swing-bed or distinct-part inpatient stays.  
 
Table 3: Bed Utilization Rates at CAHs and Acute-Care Hospitals 
Annual average bed  
Average  Annual average  utilization rate 
Annual average total 
   number  of   total available  (percentage of  
inpatient days  
beds  bed days   available bed days  
occupied)  
CAH (n = 1,311)   22  8,042   1,726   21%  
Small hospitals  
52  18,972   7,046   37%  
(n = 1,290)  
Medium-sized 
205  74,655   42,240   57%  
hospitals (n = 1,770)  
Large hospitals 
608  214,585   139,582   65%  
(n = 380)  
Source:  OIG analysis of hospital cost reports, 2013. 
 
Inpatient beds at CAHs were primarily used by Medicare beneficiaries. 
Medicare beneficiaries used approximately 62 percent of all inpatient bed 
days at CAHs. In addition, CAHs provided a greater percentage of their 
total inpatient bed days to Medicare beneficiaries than did acute-care 
hospitals.  Chart 1 illustrates the frequency with which Medicare 
beneficiaries utilized inpatient services at CAHs and acute-care hospitals.  
This chart shows the percentage of inpatient bed days occupied by 
Medicare beneficiaries at CAHs and acute-care hospitals.  
 
33 We used 2010 cost report data  for 33  CAHs and 130  acute-care hospitals. 
Services Provided by Critical Access Hospitals in 2011 (OEI-05-12-00081)   10 
   
   
Chart 1: Medicare Beneficiaries Utilization of Inpatient Services at CAHs 
and Acute-Care Hospitals 
70% 
60% 
50% 
40% 
Percent of total 
30% 
inpatient bed days 
used by Medicare 
20%  beneficiaries 
10% 
0% 
CAHs  Small hospitals  Medium-sized  Large hospitals 
(n = 1,311)  (n = 1,290)  hospitals  (n = 380) 
(n = 1,770) 
 Source:  OIG analysis of hospital cost reports, 2013. 
 
Most of CAHs Medicare inpatient admissions were emergency or urgent 
admissions. CAHs inpatient admissions for Medicare beneficiaries 
primarily resulted from emergency room visits and from occasions in 
which beneficiaries needed urgent care and were admitted to the first 
available accommodation. Emergency room visits and instances where 
beneficiaries needed urgent care accounted for approximately 74 percent 
of CAHs inpatient admissions.  Elective admissions, meaning instances in 
which Medicare beneficiaries pre-authorized their admissions, accounted 
for 26 percent of CAHs inpatient admissions.  Other types of admissions 
accounted for less than 1 percent of CAHs inpatient admissions.34    
Emergency admissions at CAHs were a smaller percentage of all 
admissions than they were at acute-care hospitals.  Conversely, urgent and 
elective admissions were a larger percentage of all admissions at CAHs 
than they were at acute-care hospitals.  Chart 2 summarizes the sources of 
inpatient admissions for CAHs and acute-care hospitals.   
 
34 Research  Data Assistance Center, Claim Inpatient Admission Type Code.  Accessed at 
http://www.resdac.org/cms-data/variables/Claim-Inpatient-Admission-Type-Code on  
July 30, 2013. 
Services Provided by Critical Access Hospitals in 2011 (OEI-05-12-00081)   11 
   
   
Chart 2:  Sources of Inpatient Admissions at CAHs and Acute-Care 
Hospitals  
70.0% 
60.0% 
50.0% 
40.0%  Emergency 
30.0%  Urgent 
Elective 
20.0% 
Other 
10.0% 
0.0% 
CAHs  Small  Mediumsized  Large 
(n  =  1,329)  hospitals  hospitals  hospitals 
(n  =  1,290)  (n  =  1,770)  (n  =  380) 
 
 
Source:  OIG analysis of NCH inpatient  claims  files, 2013.  
 
CAHs provided few surgical inpatient surgical services.   The MS-DRGs 
for which CAHs most frequently billed were primarily medical rather than 
surgical. Except for joint replacements, these MS-DRGs were for the 
treatment of illnesses like pneumonia, kidney and urinary tract infections, 
and digestive disorders.  Although joint replacements were CAHs 
eighth most frequently billed MS-DRG, only 432 CAHs (approximately 
33 percent of CAHs) provided this service to Medicare beneficiaries.  
The MS-DRGs for which CAHs most frequently billed were different 
from those most frequently billed for by acute-care hospitals.  
Table 4 presents a ranking of the MS-DRGs for which CAHs billed most 
frequently for Medicare beneficiaries in 2011 and includes listings of how 
those MS-DRGs rank in frequency relative to other MS-DRGs billed for 
by acute-care hospitals. 
 
   
Services Provided by Critical Access Hospitals in 2011 (OEI-05-12-00081)   12 
   
   
Table 4: MS-DRGs For Which CAHs Most Frequently Billed  
Small hospitals   Medium-sized   Large hospitals  
CAHs (n = 1,329) 
(n = 1,290)   hospitals (n = 1,770)   (n = 380)  
Description of  Number  Number  Number  Number 
Ranking   Number 
MS-DRG*   of times  of times  of times  of times 
that 
MS-DRG   Ranking   MS-DRG   Ranking   MS-DRG   Ranking   MS-DRG  
provided 
was   was   was   was  
service  
billed  billed  billed   billed 
Simple pneumonia 
& pleurisy  w/CC  
1  1,295   23,137  2  41,798  6  141,060  9  58,599  
[complications or  
comorbidities]  
Simple pneumonia 
& pleurisy  w/o 
2  CC/MCC [major  1,297   18,486  14  20,761  32  58,572  46  21,639  
complications or 
comorbidities]  
Kidney & urinary  
3  tract infections w/o  1,273   17,680  5  33,233  5  149,070  6  69,468  
MCC  
Esophagitis, 
gastroent & misc 
4  1,269   16,183  4  33,720  3  180,511  3  90,233  
digest disorders 
w/o MCC  
Chronic obstructive 
5  pulmonary disease  1,247  15,279   8  26,031   20  86,997   30  30,958  
w/o CC/MCC   
Misc disorders of 
nutrition, 
6  metabolism,  1,285  14,949   7  26,781   13  109,593   14  51,137  
fluids/electrolytes  
w/o MCC  
Heart failure & 
7  1,233   10,729  6  31,075  4  160,787  4  83,688  
shock w/CC 
Major joint 
replacement or 
8  reattachment of  432  10,181  1  75,216  1  313,238  1  149,502  
lower extremity  w/o  
MCC  
Heart failure & 
9  1,217   9,889  19  16,636  30  67,623  31  30,782  
shock w/o CC/MCC  
10  Cellulitis w/o MCC   1,234   9,398   11  22,358   15  107,254   16  49,234 
 Source:  OIG analysis of NCH inpatient  claims  files, 2013. 

*Wording for MS-DRG descriptions is verbatim from CMSs FY 2011 IPPS Final Rule Data Files. 

 
CAHs provided fewer inpatient services that included operating-room  
procedures than did acute-care hospitals.  Approximately 8 percent of the 
MS-DRGs for which CAHs billed Medicare were surgical MS-DRGs.  
Comparatively, approximately 21 percent of the MS-DRGs for which 
small acute-care hospitalsthe hospital size most similar to that of  
CAHsbilled Medicare were surgical MS-DRGs.  Chart 3 illustrates the 
percentages of surgical, medical, and unclassified MS-DRGs for which 
CAHs and acute-care hospitals billed Medicare.   
Services Provided by Critical Access Hospitals in 2011 (OEI-05-12-00081)   13 
   
   
Chart 3:  Percentages of  Surgical and Medical MS-DRGs For Which CAHs 
and Acute-Care Hospitals Billed Medicare 
100% 
90% 
80% 
70% 
Unclassified MS-DRGs 
60% 
50% 
Medical MS-DRGs 
40% 
30%  Surgical MS-DRGs 
20% 
10% 
0% 
CAHs  Small hospitals  Medium-sized  Large hospitals 
(n = 1,329)  (n = 1,290)  hospitals  (n = 380) 
(n= 1,770) 
 
Source:  OIG analysis of NCH inpatient  claims  files, 2013.  
 
Most CAHs had average inpatient stays of 34 days. Most CAHs annual 
average lengths of stays fell within the statutory 4-day requirement, 
although the average length of stay at a few CAHs appears to have 
exceeded 4 days. Chart 4 shows CAHs average lengths of stays for all 
patients in 2011. 
 
Chart 4:  CAH Patients Average Lengths of Stays 
900 
800 
700 
600 
500 
400 
Number of CAHs 
300 
(n = 1,311) 
200 
100 
0 
Less than 3 days  3-4 days  Greater than 4 days 
 
Source:  OIG analysis of hospital cost reports, 2013.  
 
 
   
Services Provided by Critical Access Hospitals in 2011 (OEI-05-12-00081)   14 
   
   
CAHs Reported Providing Outpatient and Inpatient Services 
from a Wide Array of Hospital Departments 
CAHs provided inpatient and outpatient services from a variety of 
departments to Medicare beneficiaries in 2011.  More than 75 percent of 
CAHs provided services in cardiology, respiratory, and operating-room  
departments; conversely, fewer than 25 percent of CAHs provided 
services in oncology, inpatient dialysis, or behavioral health departments.  
Table 5 lists the departments from which more than 60 percent of CAHs 
provided services, and Table 6 lists the departments from which fewer 
than 50 percent of CAHs provided services.35    
 
   
 
35 There were no departments in  which services were provided by more than  50 percent,  
but less than  60  percent, of CAHs in  2011. 
Services Provided by Critical Access Hospitals in 2011 (OEI-05-12-00081)   15 
   
   
Table 5: Departments in Which More Than 60 Percent of CAHs Provided Services 
Number of CAHs  
Department   Percentage of   CAHs  
(n = 1,329)  
Pharmacy    1,326   >99%  
Radiology  diagnostic  1,319   >99%  
EKG/ECG (electrocardiogram)   1,319   >99%  
Laboratory  1,319   >99%  
Emergency room   1,319   >99%  
Specialty services  1,312   99%  
Physical therapy  1,297   98%  
CT scan  1,282   97%  
Other imaging services  1,268   95%  
Other diagnostic services  1,252   94%  
Cardiology  1,211   91%  
Pulmonary function  1,169   88%  
Respiratory services  1,162   87%  
Operating-room services  1,136   86%  
Other therapeutic  services  1,096   83%  
Magnetic resonance technology (MRT)   1,080   81%  
Speech therapy - language pathology  1,023   77%  
Occupational therapy  1,011   76%  
IV therapy  978  74%  
Anesthesia  962  72%  
Preventive care services  932  70%  
Laboratory - pathology   877  66%  
Nuclear medicine  823  62%  
 
Source:  OIG analysis of NCH inpatient and outpatient  claims  files, 2013. 
 
 
   
Services Provided by Critical Access Hospitals in 2011 (OEI-05-12-00081)   16 
   
   
 
Table 6: Departments in Which Fewer Than 50 Percent of CAHs Provided Services 
Number of CAHs that  
Percentage of CAHs 
Department   provided service    
that provided service 
(n = 1,329)  
EEG (electroencephalogram)   592  45%  
Intensive care  505  38%  
Gastrointestinal (GI) services  487  37%  
Radiology - therapeutic and/or chemotherapy 
451  34%  
administration 
Ambulance  302  23%  
Behavioral health treatment/services  230  17%  
Ambulatory surgical care  202  15%  
Labor room/delivery  202  15%  
Coronary care   151  11%  
Audiology  121  9%  
Trauma response  120  9%  
Oncology  58  4%  
Inpatient renal dialysis  40  3%  
Extra-corporeal shock wave therapy    36  3%  
Osteopathic services  10  <1%  
Nursery  2  <1%  
 
Source:  OIG analysis of NCH inpatient and outpatient  claims  files, 2013. 
 
Most CAHs Provided Swing-Bed Services  
In addition to inpatient and outpatient services, approximately 92 percent 
of CAHs (1,212 CAHs) provided swing-bed services to their patients in 
2011. Swing-bed services include the same types of services that 
beneficiaries would receive in a skilled nursing facility, such as nursing 
care and rehabilitative therapies.  
More CAHs provided swing-bed services than acute-care hospitals.  In 
2011, 29 percent of small acute-care hospitals (368 hospitals) and 
2 percent of medium-sized acute-care hospitals (36 hospitals) provided 
this service. Hospitals with more than 100 beds (excluding beds for 
newborns and in intensive care units) are not permitted to offer swing-bed 
services. 36  
CAHs on average used proportionally more of their available bed days 
supplying swing-bed services than did acute-care hospitals.  On average, 
 
36 42  CFR  482.66(a)(1).  
Services Provided by Critical Access Hospitals in 2011 (OEI-05-12-00081)   17 
   
   
CAHs used 10 percent of their total available bed days supplying 
swing-bed services, while small and medium-sized acute-care hospitals 
used approximately 4 percent of their total available bed days supplying 
those services. Table 7 lists the number of hospitals that provided 
swing-bed services, the average total swing-bed days used by all CAH 
patients, and average total swing-bed days as a percentage of average total 
available bed days for CAHs and acute care hospitals.37    
 
Table 7: CAHs Swing-Bed Utilization Rates 
Number of   Average  total 
hospitals that   Average total  swing-bed days as a 
Average total 
   provided  available bed  percentage of average 
swing-bed  days*   swing-bed days   total available bed 
services   days  
CAHs (n = 1,311)  1,212   7,799   784  10%  
Small hospitals  
368  17,138   648  4%  
(n = 1,290)  
Medium-sized 
36  40,832   1,513   4%  
hospitals (n = 1,770)  
Source:  OIG analysis of hospital cost reports, 2013. 
*  This figure includes general acute-care and  swing-bed inpatient days, and excludes distinct-part inpatient days. 
 
Few CAHs Had Distinct-Part Units 
Most CAHs did not have distinct-part units in 2011.  Only 6 CAHs had 
distinct-part rehabilitation units and 60 CAHs had distinct-part psychiatric 
units in 2011. Table 8 describes the number of CAHs that had 
distinct-part units and the number of Medicare beneficiaries who received 
services in these units. 
 
Table 8: Distinct-Part Units at CAHs  
Number of CAHs   Total number of   Average number  of 
   that had   Medicare  Medicare 
distinct-part units  beneficiaries   beneficiaries per CAH  
Rehabilitation 
6  495  83 
distinct-part units 
CAHs 
(n = 1,329)  
Psychiatric distinct-part 
60  6,545   109 
units 
Source:  OIG analysis of NCH inpatient  claims  file, 2013. 
 
   
 
37 Hospitals total swing-bed  days represents the number of days annually that are 
occupied by patients receiving swing-bed services. 
Services Provided by Critical Access Hospitals in 2011 (OEI-05-12-00081)   18 
   
   
Most CAHs Received Between  $1 Million and $10 Million in 
Medicare Payments for Services Provided 
Medicare payments for all types of services provided at CAHs in 
2011 ranged from less than $1 million to more than $26 million.  Most 
CAHs received between $1 million and $10 million in total Medicare 
payments.  Chart 5 illustrates the distribution of Medicare payments to 
CAHs in 2011. 
 
Chart 5:  Distribution of Medicare Payments to CAHs  
700 
600 
500 
400 
Number of CAHs 
300  (n = 1,329) 
200 
100 
0 
Less than $1  $1 million$5  $5 million$10 $10 million$15  Greater than 
million  million  million  million  $15 million 
 
 
Source:  OIG analysis of NCH inpatient and outpatient  claims  files, 2013. 
 
In 2011, the average CAH received approximately $6.4 million in 
Medicare payments.  Of Medicare payments to the average CAH, 
approximately 30 percent were for inpatient services, 51 percent were for 
outpatient services, 19 percent were for swing-bed services, and 1 percent 
was for distinct-part psychiatric and rehabilitation services.  See 
Table 9 for a description of Medicare payments to CAHs in 2011.   
 
   
Services Provided by Critical Access Hospitals in 2011 (OEI-05-12-00081)   19 
   
   
Table 9: Mean, Median, and Range of Medicare Payments to CAHs 
  Mean   Median   Minimum   Maximum  
Total Medicare payments   $6,360,349   $5,498,080   $147,916   $26,788,129  
Medicare payments for inpatient services  $2,091,719   $1,542,403   $0  $12,588,660  
Medicare payments for outpatient services  $3,302,590   $2,684,886   $92,723   $14,765,124  
Medicare payments for swing-bed services  $966,040   $781,938   $0  $8,093,736  
CAHs 
(n = 1,329)   Percentage of total Medicare payments for 
30.3%  29.7%   0%   71.4%  
inpatient services  
Percentage of total Medicare payments for 
50.6%  50.9%   11.3%   100%  
outpatient services 
Percentage of total Medicare payments for 
19.1%  17.1%   0%   83.7%  
swing-bed services 
Source:  OIG analysis of NCH inpatient and outpatient  claims  files, 2013. 
 
Some CAHs receive large percentages of their Medicare payments for just 
one type of service. For example, 53 CAHs received more than 50 percent 
of their Medicare payments for swing-bed services, including 5 CAHs that 
received more than 75 percent of their Medicare payments for such 
services. Similarly, 17 CAHs received more than 80 percent of their 
Medicare payments for outpatient services, including 7 CAHs that 
received more than 95 percent of their Medicare payments for such 
services. 
Some CAHs received a low percentage of their total Medicare payments 
for inpatient services. In 2011, 54 CAHs received less than 10 percent of 
their Medicare payments for inpatient services, including 8 CAHs that 
received less than 3 percent of their Medicare payments for such services  
and 4 CAHs that did not receive any Medicare payments for inpatient 
services. 
 
 
    
 
 
   
Services Provided by Critical Access Hospitals in 2011 (OEI-05-12-00081)   20 
   
   
CONCLUSION 
This report provides information about the services CAHs provided in 
2011 and to what extent Medicare beneficiaries and other patients used 
these services. Policymakers and regulators can use the information 
provided in this work as they consider recommended changes to CAH 
certification requirements and payments. 
In August 2013, OIG made several recommendations about how facilities  
are certified and recertified as CAHs.  OIG recommended that CMS seek 
legislative authority to assess whether existing CAHs should retain their 
certifications.  OIG has further recommended that CMS seek legislative 
authority to revise the CAH conditions of participation to include 
measures of whether CAHs serve beneficiaries who would otherwise be 
unable to reasonably access hospital services.  CMS could use these 
measures to further evaluate a hospitals CAH certification in cases where  
the hospital did not meet the current requirements related to its location.   
Additionally, the Administrations 2014 budget contains proposals about 
changes in the CAH certification requirements and how much Medicare 
should reimburse CAHs for their services.  The budget proposes that 
CAHs within 10 miles of another hospital lose their certification.  The 
budget also proposes decreasing Medicare reimbursement from 101 to 
100 percent of costs. 
As policymakers consider OIGs recommendations and the 
Administrations proposals, they should consider OIGs previous work on 
CAHs, the current report, and future work on the topic.  Previous OIG 
work examined the location of CAHs relative to other hospitals.  
Upcoming work will examine beneficiaries coinsurance burden when 
receiving CAH outpatient services and Medicare reimbursement for 
swing-bed services. 
Finally, additional insights into the role CAHs play in the healthcare 
system might be gained by conducting more detailed analyses of 
individual CAHs and the capacity of the healthcare systems that are in 
close proximity to CAHs.  
 
   
Services Provided by Critical Access Hospitals in 2011 (OEI-05-12-00081)   21 
   
   
APPENDIX A 
Detailed Methodology   
Table A-1:  Analyses,  Sources, and Methods by Table or Chart 
Table/ 
Analysis   Source  Method  
Chart  
Number of Medicare 
Inpatient 
beneficiaries who visited 
and  We counted the number of distinct Medicare beneficiaries who 
CAH and acute-care  Table 1  
outpatient  received inpatient and outpatient services.  
hospital inpatient and 
files  
outpatient departments 
We matched each Heathcare Common Procedure Coding 
System (HCPCS) codewhich described the service 
providedto its Berenson-Eggers Type of Service (BETOS) 
CAHs most frequently   code, which groups HCPCS codes into readily understood 
provided types of   Table 2   Outpatient  clinical categories.38  We then calculated the frequency  with  
file  
outpatient services  which each BETOS code was represented in CAH outpatient 
claims. We also calculated the frequency  with which CAHs top 
10 BETOS codes were represented in acute-care hospitals 
outpatient claims. 
From the cost reports, we retrieved the number of inpatient beds 
and the number of inpatient bed days (days that a bed was used 
to treat an inpatient) at each CAH and acute-care  hospital.  We 
CAHs and acute-care 
found the average number of beds for each group of hospitals, 
hospitals bed utilization  Table 3   Cost reports  
and multiplied that number by 365 to calculate the annual 
rates for all patients 
average number of available bed days.  We then divided the 
number of inpatient bed days by this number to get the inpatient 
utilization rate for each group. 
From the cost reports, we retrieved the number of inpatient bed 
days that were used by Medicare beneficiaries and the total 
Medicare beneficiaries 
number of inpatient bed days at each CAH and acute-care 
utilization of inpatient 
Chart 1   Cost reports   hospital. We then divided the number of inpatient days that 
services at CAHs and 
were used by Medicare beneficiaries by the total number of 
acute-care hospitals 
inpatient bed days to calculate the percentage of inpatient bed 
days used by Medicare beneficiaries for each group of hospitals. 
Sources of CAHs and 
We counted the number of CAH and acute-care hospital 
acute-care hospitals  Chart 2   Inpatient file  39 
admissions that came from each admission source.  
inpatient admissions 
We counted the number of times each MS-DRG  was 
CAHs most frequently   represented in CAH inpatient claims.  We also calculated the 
Table 4   Inpatient file 
billed MS-DRGs   frequency with which each CAHs top 10 MS-DRGs were 
represented in acute-care hospital inpatient claims.  
Percentages of surgical 
We counted the number of surgical and medical MS-DRGs at 
and medical MS-DRGs 
CAHs and acute-care hospitals by matching the MS-DRGs 
for which CAHs and  Chart 3   Inpatient file 
billed to CMSs list of FY  2011 MS-DRGs, which classified 
acute-care hospitals  40 
MS-DRGs as either surgical or medical.  
billed Medicare 
continued on next page 
 
 
38 CMS, Berenson-Eggers Type  of Service (BETOS) Codes.  Accessed at 
http://www.cms.gov/Medicare/Coding/HCPCSReleaseCodeSets/BETOS.html on 
August 5, 2013. 
39 Research  Data Assistance Center, Claim Inpatient Admission Type Code.  Accessed at 
http://www.resdac.org/cms-data/variables/Claim-Inpatient-Admission-Type-Code on  
July 30, 2013. 
40 75 Fed. Reg. 50042, 50548  (Aug. 16, 2010). 
Services Provided by Critical Access Hospitals in 2011 (OEI-05-12-00081)   22 
   
   
 
 
Table A-1:  Analyses, Sources, and Methods by Table or Chart, Continued 
Table/ 
Analysis   Source   Method  
Chart  
From the cost reports, we retrieved the average length of stay for 
CAH patients average  Cost  each CAHs inpatients. We then grouped the CAHs based on 
Chart 4  
lengths of stay   reports   their average lengths of stay and counted the number of CAHs in 
each group. 
Inpatient  We counted the number of CAHs that provided specific revenue 
Departments from which 
and  center codes on their inpatient or outpatient claims.  Revenue 
more than 60 percent of  Table 5  
outpatient  center codes describe specialized units or departments in 
CAHs provided services  files   hospitals.41  
Inpatient  We counted the number of CAHs that provided specific revenue 
Departments from which 
and  center codes on their inpatient or outpatient claims.  Revenue 
fewer than 50 percent of  Table 6  
outpatient  center codes describe specialized units or departments in 
CAHs provided services 
files   hospitals.  
We used the cost report data to determine the number of CAHs 
and acute-care hospitals that provided swing-bed services.  We 
also retrieved the number of inpatient beds, as well as the 
number of swing-bed days  (the number of days each bed was 
CAHs swing-bed   used to provide skilled nursing services to a patient), for each 
Cost 
utilization rates for all  Table 7   group of hospitals.  We multiplied the number of inpatient beds 
reports  
patients  available by 365 to calculate the number of total available bed 
days for each group.  We then divided the total swing-bed days 
by the total available bed days to  calculate the total swing-bed 
days as a percentage of total available bed days for each group 
of hospitals.  
We counted the number of CAHs that submitted claims from a 
distinct-part unit and the number of distinct Medicare 
Distinct-part units at  Inpatient  beneficiaries who received services in those units.  We then 
Table 8  
CAHs  file   divided the total number of Medicare beneficiaries by the number 
of CAHs to calculate the average number of Medicare 
beneficiaries per CAH.  
Source:  OIG analysis method, 2013. 
 
 
   
 
41 Research  Data Assistance Center, Revenue  Center Code.   Accessed at 
http://www.resdac.org/sites/resdac.org/files/Revenue%20Center%20Table.txt on  
August 5, 2013. 
Services Provided by Critical Access Hospitals in 2011 (OEI-05-12-00081)   23 
   
   
APPENDIX B 
Distribution of CAHs across All States   
 
AK  
 
Source:  OIG analysis of NCH inpatient and outpatient  claims  files, 2013. 
Services Provided by Critical Access Hospitals in 2011 (OEI-05-12-00081)   24 
   
   
ACKNOWLEDGMENTS 
This report was prepared under the direction of Ann Maxwell, Regional 
Inspector General for Evaluation and Inspections in the Chicago regional 
office; Thomas Komaniecki, Deputy Regional Inspector General; and 
Laura Kordish, Deputy Regional Inspector General.  
Lisa Minich served as the team leader for this study, and Elliot Curry 
served as the lead analyst.  Other Office of Evaluation and Inspections 
staff from the Chicago regional office who conducted the study include 
Brian Jordan. Central office staff who provided support include 
Clarence Arnold, Heather Barton, and Christine Moritz.  
 
Services Provided by Critical Access Hospitals in 2011 (OEI-05-12-00081)   25 
   
Office of Inspector General
http://oig.hhs.gov  
 
The mission of the Office of Inspector General (OIG), as mandated by Public Law 95-452, as  
amended, is  to protect the integrity of the Department of  Health and Human Services  
(HHS)  programs, as well as the health and welfare of beneficiaries  served by those 
programs.  This statutory mission  is  carried  out through  a nationwide network  of  audits, 
investigations, and inspections conducted by the  following operating components: 
Office of Audit Services 
The Office  of  Audit Services  (OAS) provides auditing services  for HHS, either by  conducting  
audits  with its own audit resources or by  overseeing  audit work done by others.  Audits  
examine the performance of HHS programs and/or its grantees and contractors in carrying  
out their respective responsibilities and are intended  to provide independent assessments of 
HHS programs and operations.  These assessments help reduce waste, abuse, and  
mismanagement and promote economy and efficiency  throughout  HHS. 
Office of Evaluation and Inspections 
The Office  of  Evaluation and Inspections (OEI)  conducts national evaluations to  provide 
HHS, Congress, and the public with timely, useful, and reliable information on significant 
issues.  These evaluations focus on preventing fraud,  waste, or abuse  and promoting  
economy, efficiency, and effectiveness of departmental programs.  To promote impact, OEI 
reports also present practical recommendations for improving program operations.  
Office of Investigations 
The Office of Investigations (OI) conducts criminal, civil, and administrative investigations  
of  fraud and misconduct  related to HHS programs, operations, and beneficiaries.  With 
investigators working in all 50 States and the District of Columbia, OI  utilizes its resources 
by actively  coordinating with the Department  of Justice  and other Federal, State, and local 
law enforcement authorities.  The investigative efforts of OI often lead to  criminal 
convictions, administrative sanctions,  and/or  civil monetary  penalties.  
Office of Counsel to the Inspector General 
The Office of Counsel to the  Inspector  General (OCIG) provides general legal services to 
OIG, rendering  advice and opinions on HHS programs and operations and  providing all  
legal support for OIGs  internal operations.  OCIG represents  OIG in all civil and 
administrative fraud and abuse cases involving HHS programs,  including False Claims Act, 
program exclusion, and civil monetary penalty cases.  In  connection with these cases, OCIG 
also negotiates and monitors corporate integrity agreements.  OCIG renders advisory 
opinions, issues compliance program  guidance, publishes fraud alerts, and provides other  
guidance  to  the health care industry concerning the anti-kickback statute and other  OIG  
enforcement authorities.