There are often two widespread, often incorrect beliefs about Medicare Cost Reports.
First is the terminology. “Medicare” cost reporting makes it sound as if it only covers Medicare patients. This is not accurate. For most of the key worksheets — there are several dozen — the data generally covers services for all patients. Only fairly late in the cost report calculations that Medicare costs are determined.
The second belief is that Medicare cost reports are unimportant. We have often heard: “No one takes them seriously.”
Events have proven differently. One of the largest fines in U.S. history was levied as the result of cost report issues. Medicare and its Office of Inspector General take them seriously. As one hospital CFO said in one seminar on cost reporting: It is not a fun day when you get a letter in the mail from the Office of the Inspector General.