The end of May marks the unofficial beginning of summer here in the United States. It’s the typical time of the year – pandemic notwithstanding – when schools are out of session, individuals and families take vacations, and temperatures in some parts of the country start to rise into triple digits.
For Medicare-certified institutional providers whose fiscal year coincides with the calendar, the end of May is also the time they submit their annual cost report to their Medicare Administrative Contractor (MAC). This also is the case for organizations such as accounting, audit, consulting and law firms; medtech enterprise staffing and advisory groups; and international and offshore delivery companies that perform functions for organizations that participate in Medicare.
Filing extensions for the program are granted only under extreme circumstances, for which the COVID-19 pandemic qualifies. Therefore, many entities whose fiscal year ended December 31, 2020 were granted a 60-day filing extension, resulting in a new due date in August. This new filing deadline applies to all provider types, including hospitals, skilled nursing facilities, home health agencies, hospices, and federally qualified health centers (FQHCs).
Promoting reliable and accurate reimbursement
These cost reports due annually to the Centers for Medicare & Medicaid Services (CMS) contain detailed provider information, including facility characteristics, utilization data, cost, and charges by cost center (in total and for Medicare), Medicare settlement data and financial statement data. CMS maintains the data from these reports in the Healthcare Provider Cost Reporting Information System (HCRIS) and utilizes it to set future reimbursement rates, establish benchmarks and project the Medicare Trust Fund.
Ensuring a complete and accurate cost report is especially crucial for healthcare organizations that receive a majority of their revenue from government payers and those entities transitioning to value-based care. These reports indicate whether or not a provider has been overpaid or underpaid for reimbursable services.
Eliminating payment delays
Cost reports that are submitted late or are fraught with errors often cause participating healthcare organizations to be hit with financial penalties, delayed future reimbursements, or even the withholding of Medicare reimbursement. Some entities may even stop receiving reimbursement from Medicare, severely affecting their organizational sustainability and ability to efficiently offer healthcare services to patients.
It’s clearly essential for Medicare-certified institutional providers to follow a set of best practices to ensure their cost report is not only submitted in a timely manner but also is accurate and complete. Let’s look at 4 of those practices below:
#1: Plan ahead
Preparing the research to answer each Medicare cost report question is no simple feat. Failing to start compiling the necessary data in a timely manner almost ensures your organization isn’t going to meet the Medicare deadline and will be negatively impacted by delayed reimbursement and possibly fines.
By submitting a cost report early, you can more quickly amend any discovered errors. To gauge your progress during the fiscal year, consider preparing a quarterly cost report to be used only inside your organization. Another option is to review cost reports from years past to identify any missed opportunities for reimbursement. Have a staffing plan in place that includes experts who can meet you where you are and actively guide your team to ensure sustainable results.
#2: Use a submission checklist
MACs utilize a cost report acceptability checklist to verify acceptability of a provider’s cost report. A similar type of cost report submission checklist is recommended to assist participating entities in helping to ensure the required data and documentation and other supporting materials are in place before submission.
It should be comprehensive and consist of items that must be submitted to have an acceptable cost report submission. Keep your data secure for a long period of time and be available in case of an audit by Medicare or another government agency. Put auditing experts into action to help minimize errors and uncover risks and opportunities for your organization.
#3: Utilize data analytics
As we mentioned in a recent blog, data analytics enable healthcare providers to dramatically improve their quality of care by leveraging more value and insights from this information. These analytics also can be used to help your organization submit a comprehensive and accurate Medicare cost report, quickly and easily identify specific information needed in the case of an audit and mitigate errors that might cause you to lose some reimbursement.
#4: Partner with experienced consultants
The resources required to compile and submit an accurate cost report in a timely manner are many. Some organizations might not have the necessary resources available to complete this monumental task.
Relying on a staffing partner with experts trained in handling Medicare costs reports can save your organization both time and money. These experts know the rules and regulations of the process and can guide your organization through it one step at a time using a strategic timeline. Plus, they can work with you to ensure your organization receives the highest level of reimbursement available.
As a strategic partner to healthcare organizations and organizations that work closely with the rapidly evolving healthcare industry, we deliver both the human capital and operational expertise to aid healthcare organizations as they navigate the shift to value-based care. Lean on our expertise and experience as we lead the charge to secure your success.