Helpful Tips for Completing Medicare Cost Reports
Oct 29, 2020
If you have ever looked at a Medicare Cost Report (MCR), you likely cringe at the thought of having to fill out copious amounts of forms and data. If the sheer volume doesn’t faze you, the pressure to produce a comprehensive and entirely accurate report is enough to make most healthcare providers a little uneasy.
This highly complex report requires significant data collection and research, and although the Centers for Medicare and Medicaid Services (CMS) provides instructions on their website, this tedious process remains an arduous task for many healthcare providers. While there is no avoiding this complicated document, there are some tips to help streamline the process and ensure your time is wisely spent.
Don’t include medical directors on Worksheet A-8-2
MCRs require disclosure of specific wage and compensation data. However, because the roles and compensation associated with medical directors and chiefs of medical staff vary from practice to practice, these positions are not subject to Reasonable Compensation Equivalent (RCE) limits. As a result, you can exclude these wages from Worksheet A-8-2.
Make sure you get credit for Medicare HMO days
Hospitals will frequently provide inpatient services to Medicare Advantage or Health Maintenance Organization (HMO) patients. To get credit for these Medicare HMO days, you should include the Provider Statistical Reimbursement (PS&R) report 118 as a part of your filing. These “no pay” or “information only” claims are used to calculate reimbursement for Health Information Technology, Medical Education, Allied Health, Disproportionate Share, and Uncompensated Care.
Include the right data to update the hospital’s wage index
To address wage disparities across the U.S., Medicare payment rates are lower for hospitals in areas with wages below the national average. To update the hospital’s wage index, the hospital will need to fill out Worksheet S-3, Part II. In this section, you may include clinical and patient care-related services as well as executive and administrative services. While every section of the MCR should be accurate, it’s especially critical for hospitals to double-check that Worksheet S-3 (specifically Parts II, III, and IV) are correct.
Take advantage of the knowledge in Worksheet S-2
Because CMS will frequently publish new regulations and notices, it’s vital to stay up to date on how these updates may affect you. In addition to looking out for new regulations, filling out the detailed questions in Worksheet S-2 will provide you with a solid understanding of your facility and operations. Together, this knowledge will help you better interpret and assess how these changes may impact the hospital.
Include all lump-sum payments
There are some payments (such as medical education, bad debts, and uncompensated care) that may result in added payments from Medicare. Be sure to include and confirm any payments the hospital has received on any individual claims in your PS&R report.
Make sure your report is complete, accurate, and on time
It’s imperative to remember that there is no “late filing” option for MCRs. Late reports will result in financial penalties, interest charges, and provider payments being delayed or suspended. Additionally, submitting inaccurate or incomplete reports has costly consequences that put current and future reimbursements at risk. It’s best to be proactive, as thorough as possible, and pay close attention to upcoming deadlines.
Remember that there are resources available to assist you in completing and submitting your Medicare Cost Report. If you want to learn more about MCRs or how we can help you, please reach out to CRI.
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