Medical Office Building Occupancy Classification

Q: A Hospital System that I do work for is in the process of constructing a Medical Office Building off-campus (over 250 yards from the Hospital). The building will house exam rooms, treatment rooms, and procedure rooms for a Provider Based Physician. In the past, we would consider this a Business Occupancy. We have heard that for an off-campus Provider Based Physician we will need to use a more restrictive code. Is this true, and if so, do we use the Healthcare Occupancy or the Ambulatory Healthcare Occupancy for this building type?

A: On June 30, 2016, CMS issued a correction to their Final Rule to adopt the 2012 Life Safety Code. This correction specifies that all ‘hospital outpatient surgical departments’ have to meet Ambulatory Health Care Occupancy (AHCO) requirements regardless how many outpatients are incapable of taking action for self-preservation.

One of the confusing issues in this CMS communication is the phrase ‘hospital outpatient surgical departments’. Initially, most people would think that phrase describes Ambulatory Surgical Centers (ASC) because the word ‘surgical’ is used. But in follow-up communications with CMS, they described this phrase ‘hospital outpatient surgical departments’ to mean any service that qualifies under the definition of AHCO.

Section of the 2012 LSC describes AHCO as:

  • Outpatient treatment for patients that renders the patient incapable of taking action for self-preservation under emergency conditions without the assistance of others;
  • Anesthesia that renders the patients incapable of taking action for self-preservation under emergency conditions without the assistance of others;
  • Emergency or urgent care for patients who, due to the nature of the injury or illness are incapable of taking action for self-preservation under emergency conditions without the assistance of others.

This description is beyond just ASC; it includes all sorts of procedures, such as:

  • Endoscopy
  • Bronchoscopy
  • Colonoscopy
  • MRI / CT Scan
  • Cath Labs
  • Some therapy units, such as Aqua-Therapy
  • Etc.

Since the 2012 LSC says four or more outpatients in order to qualify for AHCO, CMS felt the need to issue a correction to their Final Rule to say now it is 1 or more outpatients to qualify as an AHCO.

What this means, if the physician’s office was doing a minor procedure and it only involves one outpatient at a time, and that minor procedure qualifies under as being an AHCO, then the building (or story) must meet AHCO occupancy requirements even if there is only one outpatient involved in the entire facility. Under the 2012 LSC definition, that physician office would qualify as being a Business Occupancy, but with the new CMS correction to the Final Rule, it now must be AHCO.

And this is retroactive to existing conditions.

Brad Keyes
Brad Keyes, CHSP

Brad is a former advisor to Healthcare Facilities Accreditation Program (HFAP) and former Joint Commission LS surveyor. He guides clients through  organizational assessment; management training; ongoing coaching of task groups; and extensive one-on-one coaching of facility leaders. He analyzes and develops leadership effectiveness and efficiency in work processes, focusing on assessing an organization’s preparedness for a survey, evaluating processes in achieving preparedness, and guiding organizations toward compliance. 

As a presenter at national seminars, regional conferences, and audio conferences, Brad teaches the Keyes Life Safety Boot Camp series to various groups and organizations. He is the author or co-author of many HCPro books, including the best-selling  Analyzing the Hospital Life Safety Survey, now in its 3rd edition. Brad has also authored a variety of articles in numerous publications addressing features of life safety and fire protection, as well as white papers and articles on the Building Maintenance Program. Currently serving as the contributing editor of the monthly HCPro newsletter Healthcare Life Safety Compliance  gives Brad further insight into the industry’s trends and best practices.