C.F.R. » Title 42 » CHAPTER IV—CENTERS FOR MEDICARE & MEDICAID SERVICES, DEPARTMENT OF HEALTH AND HUMAN SERVICES › SUBCHAPTER G—STANDARDS AND CERTIFICATION › PART 489—PROVIDER AGREEMENTS AND SUPPLIER APPROVAL › Subpart A—General Provisions

42 C.F.R. § 489.18

Change of ownership or leasing: Effect on provider agreement

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(a) What constitutes change of ownership—(1) Partnership. In the case of a partnership, the removal, addition, or substitution of a partner, unless the partners expressly agree otherwise, as permitted by applicable State law, constitutes change of ownership.

(2) Unincorporated sole proprietorship. Transfer of title and property to another party constitutes change of ownership.

(3) Corporation. The merger of the provider corporation into another corporation, or the consolidation of two or more corporations, resulting in the creation of a new corporation constitutes change of ownership. Transfer of corporate stock or the merger of another corporation into the provider corporation does not constitute change of ownership.

(4) Leasing. The lease of all or part of a provider facility constitutes change of ownership of the leased portion.

(b) Notice to CMS. A provider who is contemplating or negotiating a change of ownership must notify CMS.

(c) Assignment of agreement. When there is a change of ownership as specified in paragraph (a) of this section, the existing provider agreement will automatically be assigned to the new owner.

(d) Conditions that apply to assigned agreements. An assigned agreement is subject to all applicable statutes and regulations and to the terms and conditions under which it was originally issued including, but not limited to, the following:

(1) Any existing plan of correction.

(2) Compliance with applicable health and safety standards.

(3) Compliance with the ownership and financial interest disclosure requirements of part 420, subpart C, of this chapter.

(4) Compliance with civil rights requirements set forth in 45 CFR parts 80, 84, and 90.

(e) Effect of leasing. The provider agreement will be assigned to the lessee only to the extent of the leased portion of the facility.

[45 FR 22937, Apr. 4, 1980, as amended at 59 FR 56251, Nov. 10, 1994]
Notes of Decisions
Cited in 23 cases (1 in the last 5 years), 1982–2025 · leading case: TRIAD AT JEFFERSONVILLE I, LLC v. Leavitt
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TRIAD AT JEFFERSONVILLE I, LLC v. Leavitt (2008) dcd · cites it 4× “Triad argues that the Provider Agreements were assigned in December 2006 because Medicare Regulation 42 C.F.R. § 489.18 (c) provides that upon a change of ownership the “existing provider agreement will automatically be assigned to the new owner.”
In Re Raintree Healthcare Corp., Debtor. Suncrest Healthcare Center LLC v. Omega Healthcare Investors, Inc. (2005) ca9 · cites it 3× “See 42 C.F.R. § 489.18 (a)(4), (c) (2000). If Sun-crest instead had chosen to apply for a new number, the nursing home could not have participated in the Medicare program while its application was pending.”
Deerbrook Pavilion, LLC v. Donna E. Shalala, Secretary, U.S. Department of Health & Human Services United States Departm (2000) ca8 · cites it 3× “" 42 C.F.R. 489.18 (2000) (emphasis added).”
Dfs Secured Healthcare Receivables Trust v. Caregivers Great Lakes, Inc. And Marc Leestma (2004) ca7 “at 385; see also 42 C.F.R. § 489.18 (b) (“[a] provider who is contemplating or negotiating a change of ownership must notify” the Department of Health and Human Services) (emphasis added).”
In Re Vitalsigns Homecare, Inc. (2008) mab · cites it 4× “42 C.F.R. § 489.18 . Upon a change of ownership of the provider number, the existing provider agreement is automatically assigned to the new owner.”
Eagle Healthcare, Inc. v. Sebelius (2013) dcd · cites it 4× “The certification process enables CMS to ensure that Medicare beneficiaries are served by qualified healthcare providers. 42 C.F.”
Board of Trustees of State Institutions of Higher Learning v. Sullivan (1991) mssd · cites it 2× “42 C.F.R. § 489.18 . Defendant contends that 42 C.”
Richey Manor, Inc., D/B/A Richey Manor Nursing Home v. Richard Schweiker, Secretary of Health and Human Services (1982) cadc “” 42 C.F.R. § 489.18 (a)(3) (1981). 7 . It is curious that neither VOA Care nor its management agent nor Richey Manor bothered to consult the fiscal intermediary who “serve[s] as a center for, and communicate[s] to providers, any information or instructions furnished to it by…”
United States v. Contemporary Health Management of Hardin County, Inc. (1992) txed · cites it 3× “42 C.F.R. § 489.18 . Under the lease agreement, Hardin County agreed to assist CHM in obtaining recertification of the hospital as a Medicare provider (Lease § 20.”
United States v. Vernon Home Health, Inc., Vernon Home Health Care Agency, Inc. (1994) ca5 “The controlling regulation is Title 42 C.F.R. § 489.18 (d) which requires: “An assigned agreement is subject to all applicable statutes and regulations and to the terms and conditions under which it was originally issued.”
Delta Health Group, Inc. v. United States Department of Health & Human Services (2006) flnd · cites it 5× “This may be done, for example, if there is a “change of ownership,” as defined in the regulations, see generally 42 C.F.R. § 489.18 , and the new owner wants to avoid a break in service or lapse in coverage.”
BP Care, Inc. v. Thompson (2003) ohsd · cites it 2× “Title 42 C.F.R. § 489.18 states that “[a]n assigned agreement is subject to all applicable statutes and regulations and to the terms and conditions under which it was originally issued including, but not limited to .”
Show all 23 citing cases →
— 42 C.F.R. § 489.18(a)(4) — 1 case
United States v. Contemporary Health Management of Hardin County, Inc. (1992) txed “42 C.F.R. § 489.18 . Under the lease agreement, Hardin County agreed to assist CHM in obtaining recertification of the hospital as a Medicare provider (Lease § 20.”
— 42 C.F.R. § 489.18(c) — 1 case
United States v. Contemporary Health Management of Hardin County, Inc. (1992) txed “42 C.F.R. § 489.18 . Under the lease agreement, Hardin County agreed to assist CHM in obtaining recertification of the hospital as a Medicare provider (Lease § 20.”
— 42 C.F.R. § 489.18(d) — 2 cases
Deerbrook Pavilion, LLC v. Donna E. Shalala, Secretary, U.S. Department of Health & Human Services United States Departm (2000) ca8 “" 42 C.F.R. 489.18 (2000) (emphasis added).”
TRIAD AT JEFFERSONVILLE I, LLC v. Leavitt (2008) dcd “Triad argues that the Provider Agreements were assigned in December 2006 because Medicare Regulation 42 C.F.R. § 489.18 (c) provides that upon a change of ownership the “existing provider agreement will automatically be assigned to the new owner.”
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