Home Health & Hospice Week

Is cost reporting low on your priority list? If so, it’s time to reconsider.

“The penalty for not filing the cost report timely is that 100 percent of any payments will be withheld,” warns HHH Medicare Administrative Contractor Palmetto GBA in a recent Frequently Asked Question set. “In addition, providers will be assessed interest at the prevailing rate at the time the cost report is due,” Palmetto adds.

Another hassle: “Remittance Advices (RAs) will be issued as normal during a payment hold,” the MAC explains. “When the hold is released, the RAs will not be reissued. Providers will need to use the previously issued RAs for their accounting requirements,” Palmetto tells providers.

And don’t forget, the Centers for Medicare & Medicaid Services “has used cost report data to rebase hospice payments as well as modify the labor component for each level of service (used in the determination of payment rates) based on this report,” warns consulting firm The Health Group in Morgantown, West Virginia.

Tip No. 1: “Cost reports must be prepared on an accrual basis,” The Health Group says in its member newsletter. “Even if your tax return is prepared on a cash basis, cash basis cost reports are not acceptable submissions,” the firm stresses.

Tip No. 2: “Cost reports should be reconciled to tax return submissions and financial statements to ensure consistency of financial information,” The Health Group adds.