THE NEW MEDICARE COST REPORT
If your fiscal year ends on December 31, 2013, you will submit one more cost report in the old format. After that, you will most likely submit the “sequel” – a much more detailed and demanding version. To-date, this is a proposal…a proposal that we feel will become reality. However, fear not. MVI has been working to make compliance with the new requirements relatively easy. Since MVI does more Hospice Cost Reports than any other entity and anal-retentively keeps abreast of changes, we anticipated this event and immediately started to plan on adapting our 51-step validation process to accommodate. MVI is ready for the change. There will be some work on our clients’ side, and changes will be needed in accounting systems and processes. It is best if these changes are implemented as soon as practical after the final announcement is given. If it doesn’t happen, cool beans, but we are not feeling that lucky.
The new format is an attempt to more accurately capture cost data, especially cost by level of care. It should yield more useful information. However, the tradeoff will be more work. The old report format was nothing more than a re-purposed hospital cost report sans a few pages. Some pages never made much sense for hospice. What was CMS going to do with the A-7?
Of the changes that have been proposed, the most notable are:
- MOST DIRECT COSTS WILL BE CLASSIFIED BY LEVEL OF CARE.
- THE 339 FORM GOES AWAY. IT IS REPLACED BY A NEW WORKSHEET S-2.
- PAGE A-7, ANALYSIS OF CHANGES IN CAPITAL ASSET BALANCE, IS GONE.
- MEDICATIONS NEED NO LONGER TO BE TRACKED BY ANALGESICS, SEDATIVES AND OTHER.
The change that immediately affects you is the requirement that direct costs be classified by level of care. This is HUGE. MVI has identified the additional accounts that will be needed and has taken great care to eliminate non-essential accounts that would simply bloat your Chart of Accounts. We have the accounts ready to upload into our client’s systems that use the standard MVI Chart of Accounts as well as recommended system configurations.
There are really two critical pieces for fulfilling the new reporting requirements:
- A chart of accounts structure that will support levels of care in a simple way.
- A well-trained accounts payable clerk.
Over the coming months, we will be providing more information about the changes to the cost report as well as tools and advice to manage these changes. The point is, if this proposal is enacted, a hospice will have to have these in place and ready to launch on January 1, 2014, because all fiscal years beginning then or after will be reported under the new cost report format. That is NOT a lot of time.
The first “tool” we will be releasing to our clients is a list of recommended changes to your chart of accounts as well as a new and improved MVI Chart of Accounts Logic Sheet. Finally after 18 years, you get a new laminated guide sheet!
The MVI Chart of Accounts was originally created for powerful management reporting with built-in flexibility for growth AND to handle the complexities of the Hospice Cost Report with ease. In order to accommodate the upcoming changes to the cost report, we will be re-designating the last 2-digit segment in the GL account number for level of care.
We will provide these accounts to you in a format that can be easily imported into CYMA. For those who wish, we can do an “Account Restructure” to your CYMA Data. This process is more involved and will carry an additional fee, but it ensures that all accounts in the system, including vendor level defaults are mapped to the correct account. For hospices that have wanted to “redo” or “cleanup” their GL, this would be a fantastic time to do so.
We have also begun modifications to the “51-Step Validation” tool that we use for completing our clients’ cost reports. Who knows, with the changes to the report we may end up with a 75-Step Validation tool!
We will keep you posted with new information as it becomes available.
