Cost Report Blog

ECR files have a standard naming convention of eight characters and a three character extension.

Two letters that represent the type of facility (ex. HH = HHA, SN = SNF, HS = Hospice, …)

The six digits of the provider number

Period

Two digit extension for the calendar year of the cost report period end

The letter ‘A’ if this is the first Cost Report or the letter ‘B’ if it’s the second during this calendar year

The Print Image file is a compressed text file that contains the printed worksheets of the Medicare Cost Report. With the PI file, an auditor can view the cost report pages on a computer screen. The PI file has a three line encryption of a little over 70 characters at the end of the electronic file which gets printed to the Medicare cost report signature page.

SAMPLE ECR FILE (select lines only for illustration)

The Type 1 record had identifying information on the provider number, start and end date of the cost report, cost report software vendor code, date cost report was created, and date of cost report software update. (2008274 means this software release meets CMS specifications of the 274^th day of 2008, which is Sept. 20, 2008.   The second line of this records shows the military time when the ECR was generated.

Type 2 records show labels used for cost centers and overhead allocation statistics (square feet, time spent, etc.)  The third line of the above says the Worksheet A line 1 will be used for Capital Related Costs (property costs) of the Building. The fourth line of the above says the Worksheet A line 2 will be used for Capital Related Costs of the Equipment.

Type 3 records show input in the cost report and the cost report location. The fifth line of the above says that Worksheet S-2 line 4 column 3 shows the Medicare certification date as 10/15/1990. The sixth line says that Worksheet S-7 Part IV line 1 column 3.01 shows 36 Medicare days falling under the RUG category found at line 1. The seventh line says that Worksheet A line 4 column 1 shows costs of $316,282.

Type 4 records have the three lines of encryption code that are generated based upon the lines above it in the text file .  Since the encryption code is printed to the Medicare cost report signature file, the signor is attesting that the correct ECR is the one that would generate the same encryption code that is printed here on the Signature Page. If any information of the text file would get altered, then the Type 4 encryption code would be different when the encryption code is rerun by the Fiscal Intermediary, and it would be known that the text file has been altered and cannot be relied upon.

ECR stands for Electronic Cost Report.  CMS requires most of the Medicare cost reports to be submitted in an electronic file format rather than on paper.  CMS approved software must be used to generate the ECR.  The software actually produces two files; 1) the ECR file and 2) the PI (Print Image) file.  Both of these files must be transmitted in an electronic format , typically by burning onto a CD, and submitted to the Fiscal Intermediary, together with a printed and signed Signature Page.

The ECR is in a text format, and each field will have input for a given cell of the cost report and its location (Worksheet, line, and column). The ECR file has a three line encryption of a little over 70 characters at the end of the electronic file which gets printed to the Medicare cost report signature page.

Those providers which can have a settlement, have another worksheet on their Medicare cost report that compares interim payments with Medicare reimbursement deserved, and the difference is the settlement, which can be positive or negative. The reimbursement deserved can be based upon costs, such as a Critical Access Hospital or a Rural Health Clinic, or can be based upon a predetermined rate per day/visit/case, generally referred to as PPS – Prospective Payment System rates.  There may also be other elements which can effect a settlement, such as certain pass-throughs of costs for PPS providers, bonus payments, or Medicare bad debt.

The forms of the Medicare Cost Reports are divided by different letter series.  Most begin with an S series, which records identifying information on the provider (address, date of Medicare certification, etc.) and volumes of services.

The second series is the A series , which records the costs of the Trial Balance by cost centers, staring with overhead cost centers.  The last cost centers are for services deemed  as non-reimbursable by Medicare.

The A series also allows for reclassifications and adjustments to expenses.

In the B series,  overhead costs are allocated to other cost centers based upon a utilization statistic (square feet, time studies, etc.).  I

In the C and D series, a cost per day and/or service is computed and multiplied by Medicare volume to arrive at Medicare costs.

If there is possibility for a settlement, this is calculated on a separate worksheet, usually part of an E series.

In addition, most Medicare Cost Report also have worksheets for Balance Sheet accounts, Revenues , and Changes in Fund Balances.  These are found in an F or G series.

There are several different types of Medicare Cost Reports, required from various providers. Each has its own form number.

• 2552               Hospital
• 2540               Skilled Nursing Facility
• 1728               Home Health Agency
• 287                 Home Office Cost Statement
• 265                 Renal Dialysis Facility
• 222                 Rural Health Clinic/ Federal Qualified Health Clinic
• 2088               Community Mental Health Clinic
• 1984               Hospice

The Medicare Cost Report is an annual report that is required of various health care providers that participate in the Medicare program. The Cost Report records the provider’s total costs associated with providing services to all patients, and computes the portion of those costs allocated to Medicare patients. For most providers, it also records the Medicare payments received and calculates a settlement.

CMS has published their updated RUG rates as of 10/1/2010.  These include 66 RUG categories, instead of the previous 53. The RUG rates depend upon whether your SNF is urban or rural, and the wage index of your area. The number of days per RUG category in input onto Worksheet S-7 of the SNF Medicare cost report.

The RUG rates can be found here.

As a reminder, CMS has implemented a new PS&R system which is web-based.  Hard copies of the PS&R reports will no longer be sent.

A user who needs access to CMS applications or services will need to ‘Self-Register’ via IACS, as described at  the following URL:  https://www.cms.gov/PSRR/

Once the account has been approved the user will receive an e-mail with their new User ID, and a separate e-mail with information about their temporary password. If assistance is needed, a user can visit www.eushelpdesk.com or contact the IACS Help Desk at (866)484.8049.

The Provider Statistical and Reimbursement System summary is commonly referred to as the PS&R. This document summarizes number of Medicare days or visits processed for dates of service of  the cost report period , the charges, gross Medicare reimbursement earned on those claims, coinsurance and deductibles deducted, and the net payments paid by Medicare . The PS&R is widely used by Medicare cost report preparers to input such information onto the Medicare cost report.