All providers required to file a cost report are required to submit their cost report within five months of the cost reporting fiscal year end, or 30 days after a valid provider statistical and reimbursement (PS&R) report is sent to the provider by National Government Services—whichever is later. If you fail to submit a cost report timely, or if your cost report is rejected, your payments are reduced and a demand letter will be issued for previous payments.

All providers, with the exception of outpatient physical therapy providers and comprehensive outpatient rehabilitation facilities, are required to file an annual Medicare Cost Report.

The cost report forms, including the Form CMS-339, and all instructions needed to properly fill out the forms can be downloaded from the Centers for Medicare & Medicaid Services (CMS) Web site

Most providers must now file their cost report electronically using an approved vendor software program. Refer to electronic filing requirements information.

If the cost report due date falls on a weekend, a national holiday, or a holiday observed by the offices of National Government Services, the due date is extended to the next business day.

Providers filing and electronic cost report must include all of the items listed on the Cost Report Submission Checklist.

Note: We strongly encourage that you submit the following items in an electronic format (CD-ROM):

• Bad debt listing
• Wage index documentation
• Financial statements

In addition, if you are a teaching hospital, you can download the IRISEDV3 program Note: user will be leaving NGS site) from the CMS Web site.

If your facility is a children’s hospital, please complete the Children’s Hospital Verification of Age for Eligibility Form. Annual certification is required as published in the Provider Reimbursement Manual–Part 1 (PRM 15-1), Chapter 30, Section 3001.3. The majority of inpatients in the most recent cost reporting period must be under the age of 18.

Electronic Filing Requirements and List of Vendors

• Effective with cost reporting periods beginning on or after October 1, 1989, all hospitals (CMS-2552) are required to file their cost report electronically using an approved vendor’s software.
• Effective with cost reporting periods on or after March 31, 2000, skilled nursing facilities (CMS-2540) and home health agencies (CMS-1728) are required to file their cost report electronically on approved vendor software.
• Effective with cost reporting periods ending on or after December 31, 2004, hospice providers (Form CMS-1984-99) and end-stage renal disease facilities (CMS-265-94) are required to file their cost report electronically on approved vendor software.
• Effective with cost reporting periods ending on or after March 31, 2005, rural health clinics and federally qualified health centers (FQHCs) (CMS-222-92) and community mental health clinics (CMS-2088-92) are required to file electronically on approved vendor software.

To help in this effort you can either purchase the software, which will allow you to prepare and submit your cost report, or you can use the free software supplied by CMS, located on the Mutual of Omaha Medicare Web site.

The free software requires that you prepare the cost report forms manually, and then input key numbers and data into the free software for submission.

We are also providing the list of CMS-approved cost report vendors.

Home Office Cost Statements

1. Include a completed and legible cost statement on the proper forms (CMS-287-05).

2. Provide general information and certification page which includes the original signature of an officer (administrator, chief financial officer, or chief executive officer).

Home office cost statements are to be submitted within 150 days of the chain home office’s fiscal year end. If the chain home office fails to submit a cost statement within that time frame, they will be notified of their failure to submit a cost statement, and the servicing intermediary will issue a demand notice requiring repayment of home office costs. The intermediaries are required to reduce interim payments to the providers to reflect the disallowance of any home office costs.

Low and No Medicare Utilization Cost Reports

The criteria to qualify to file a low utilization cost report for all provider types (except FQHCs) are:

• Less than 10% Medicare utilization, or
• Less than $200,000 Medicare Part A + B net reimbursement

• Net Reimbursement less than $10,000

• Certification Page (Worksheet S), signed in ink by an officer or administrator
• Applicable S-series worksheets
• Waiver of Electronic Filing Form
• Balance sheet and income statement (these can be worksheets from the cost report (i.e. F-series worksheets for the 1728-94 cost report)

Items required to be submitted for a no Medicare utilization cost report:

• Certification Page (Worksheet S), signed in ink by an officer or administrator
• Waiver of Electronic Filing Form
• Certification for No Medicare Utilization Form

Penalties for Late Filing

In the event that you fail to timely file an acceptable cost report with all required information, such as the CMS-339, Medicare payments will be suspended until a cost report is filed and determined to be acceptable (see 42 C.F.R. Section 405.371 [C]). All interim payments paid for the period are considered overpayments.

If your cost report indicates an overpayment, the amount due should be mailed to the appropriate lock box with a copy of the check sent along with the cost report. If this is not possible because of a financial hardship, please submit a repayment proposal and supporting financial data. If full payment or an extended repayment plan is not submitted with the cost report, interim payments will be suspended upon receipt of the cost report. If no payment arrangements are made as indicated above, the National Government Services Part A Overpayment Recovery Department will send you a demand letter requesting payment of the amount due. The demand letter will indicate that interest will begin accruing from the day after the cost report is due and is calculated in 30-day increments for each full 30-day period until the cost report is filed and accepted. In addition, failure to file a cost report will result in a referral to the Department of Justice for collection, as well as possible termination from the Medicare program.

If the cost report is rejected, it is deemed unacceptable and treated as if it were never filed. Specifically, as is mentioned above, if an acceptable cost report is not submitted timely, a suspension of payments will be imposed. Accordingly, when a cost report is filed timely, but is rejected, and thereby deemed unacceptable, a suspension of payments will be implemented under the provisions of 42 C.F.R. Section 405.371 (C). In addition, in this situation, and in the situation where a cost report is not filed timely, interim payments for the period will be considered overpayments until an acceptable cost report is filed.