Now that 12/31/17 cost reports are behind us (hopefully for everyone), what can you do to make the process smoother for next year?
This blog will focus on the trial balance. Our next blog will deal with tracking patient days/ visit counts.
Take a look at your chart of accounts. Below are some tips to help you analyze if further detail would make the job of organizing information for the cost report easier:
- Remember that Medicare cost reports must be filed using accrual-based accounting, and make sure that you are tracking your income and expenses as such.
- Break out payroll into the various disciplines/ departments on your cost report. If this is not possible to do on your chart of accounts, keep careful track of the payroll by department in your payroll system, so that you can easily produce a report which will match the trial balance payroll.
- Break out contract into discipline/ department detail. If this is not possible to do on your chart of accounts, maintain a separate spreadsheet of the contract amounts by department.
- Make sure your payroll taxes and benefits are easily identifiable.
- Avoid classifying income and expenses into categories such as “Miscellaneous” or “Ask My Accountant” – put them into the right accounts right away.
- For hospices, keep track of all expenses and revenues by Level Of Care.
- For hospice, FQHCs, and other relevant facilities, track revenues by Medicare, Medicaid, and Other (Private/ Insurance).
- Make sure that assets, liabilities, revenues, and expenses are properly identified as what they are – don’t classify revenues, liabilities, or assets as expenses.
- Keep penalties in separate accounts from other bank charges.
- Classify malpractice and property insurances separately from other insurances. More and more cost reports are requiring that the malpractice amount be separated out.
- Keep separate accounts for different types of taxes (payroll, property, sales, and income).
- Maintain separate accounts for help-wanted advertising and promotional advertising.
- If a service is provided both by a related party and a non-related party, it is good practice to keep separate accounts for the related party expenses and the non-related party expenses.
Would you like an expert consultant to take a look at your trial balance and advise how to better position your facility for next year? Would you like a consultant to review a prepared cost report and give you comments and suggestions?
Contact Progressive Provider Services or call us at 800-447-2540 – over 30 years of cost reporting experience that you can put to good use!