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Acute care generally is provided for a short duration to treat a serious injury or episode of illness or following surgery. The care may be provided in an inpatient setting such as a hospital or on an outpatient basis such as in an urgent care center.


Medicare does not define acute care, but sets forth a payment system for reimbursing the operating costs of “acute care hospitals” for inpatient stays under Medicare Part A. A glossary posted on Medicare’s Hospital Compare website defines an “acute care hospital” as “a hospital that provides inpatient medical care and other related services for surgery, acute medical conditions or injuries (usually for a short term illness or condition).”


Acute care hospitals that contract with Medicare agree to accept predetermined rates for each discharge under the inpatient prospective payment system (IPPS) as payment in full. Under the IPPS, hospitals typically receive reimbursement on a per discharge or per case basis, which includes all outpatient diagnostic services provided by the admitting hospital or a related entity on the date of a beneficiary’s inpatient admission or within three days preceding the date of a beneficiary’s inpatient admission. See Centers for Medicare and Medicaid Services (CMS), Medicare Learning Network, Acute Care Hospital Inpatient Prospective Payment System Fact Sheet (Nov. 2011).

Long Term Care Hospitals

Medicare also certifies Long Term Care Hospitals (LTCHs) as short-term acute care hospitals. LTCHs generally are defined as having an average inpatient length of stay greater than 25 days. CMS Long Term Care Hospital Prospective Payment System: Interrupted Stay (Mar. 2011). LTCHs typically provide extended care to patients with clinically complex problems for extended periods of time.


Healthcare following an acute hospitalization, known as post-acute care, can be provided in variety of inpatient and residential-based settings, including skilled nursing facilities, inpatient rehabilitation facilities, long term care hospitals, home healthcare, and outpatient rehabilitation.