Medicare Cost/Reimbursement
Analysis
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Medicare Dependent and Sole Community
Hospitals can determine potential additional
reimbursement
Critical Access Hospital’s can determine
reimbursement and potential under/over
payment during the year.
Other Acute Care Hospital can review total
costs per revenue producing department,
cost to charge ratio, and percentage
Medicare revenue by department.
Resources needed
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Previous year’s cost report
Supporting work papers for cost report
Patient Days Statistics
 Total Days
 Medicare Inpatient Days
 Medicare Swingbed Days
WorkSheet A
Develop a General Ledger Financial
Report format that ties to departments in
Worksheet A (expenses) and Worksheet
C (revenues)
 These are year to date numbers.
 The report should tie to the supporting
work papers used to prepare the cost
report
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WorkSheet A continued
The report needs to be able to pull into
excel.
 Once the report is prepared and verified
a translator file can be created to upload
to the excel report.
 On the file to be copied use description
and year to date amount only
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The Matching Game
In order to match the revenue with the
expense a report should be ran periodically
that compares revenue codes to general
ledger account numbers.
 A report which has charge number,
description, cpt code, revenue code, and
general ledger should be developed.
 Sort by revenue code then g/l code and
compare. The cost report uses revenue
codes for allocating charges.
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Worksheet A Cont.
Once the excel report is uploaded to the
spreadsheet verify expenses are recorded
in the correct department and totals
reconcile.
 Depreciation for the building will have to
be adjusted out of equipment.
 A-6 reclasses and A-8 adjustments need
to be manually entered
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Worksheet B
This worksheet pulls adjusted expenses from
worksheet A
 Worksheet B allocates non revenue
department expenses to revenue producing
departments
 Each department is allocated based on
Medicare approved statistics.
 Worksheet B-1 is where the statistics are
manually input based off the previous years
cost report
 Worksheet B-1 is combined with Worksheet
B
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Worksheet C
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A year to date revenue by financial class
needs to be generated through the current
month in excel format.
The file should include g/l number,
description, financial class, volume, financial
class total, and grand total.
Alternatively a PS&R can be generated and
estimated through current month.
The Medicare revenue for inpatient and
outpatient by department is pulled into
worksheet C.
Worksheet D-1
This worksheet calculates the cost per
day including the ancillary services
provided to the patient.
 Total patient days, inpatient days, and
swingbed days will need to be generated
and pulled to the spreadsheet
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Medicare Reimbursement for CAHs
This worksheet relates exclusively for Critical
Access Hospitals.
 Reimbursement per day and outpatient
percentage is obtained from the current rates
your fiscal intermediary is paying the hospital
during the interim rate.
 Hospitals may have different rates during the year
if a rate review is performed. The total
Over(under) payment by Medicare should be
recorded on the hospital’s balance sheet.
 This report allows CAHs to see if they are being
significantly over(under) paid by Medicare
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Questions?