Simione™ Healthcare Consultants

It’s Time for a Mid-Year Cost Report Check-Up

Does your agency have a December 31st fiscal year end?  If so, it’s hard to believe we are more than half way through 2014.  Now is a good time to analyze mid-year expenses for the cost report so that you are not scrambling at year end.  Some of the key expenses that must be broken down by discipline are: 

  • Salaries
    • If an employee is servicing more than one discipline/line of business, are the related salary costs segregated, for example:
      • A home health aide is providing aide services and homemaking services
      • An RN is performing a skilled nursing visit for the home health agency and is also performing RN visits for the provider-based hospice
  • Travel
  • Contract Services

Are medical supplies distinguished by billable vs. routine?

Telehealth costs such as salaries and equipment leases need to be easily identifiable.

Related party transactions must be reported at cost.  Do you know what your related party transactions are truly costing you? Do you qualify for related organization cost exception?

Update the depreciation schedule for all assets purchased.

Keep miscellaneous income and expense accounts to a minimum.

Review your general ledger for inaccurate account postings.

In addition to these items above, hospice providers should pay close attention to: 

  • Tracking the costs of continuous care for both RNs and HHAs
  • Separating the cost of the volunteer coordinator and tracking all volunteer hours by type of activity
  • Reporting complementary therapies such as pet, art, and music within the “other non-reimbursable cost center”
  • Maintaining two separate accounts for nursing home room & board revenue and expense
  • Keeping separate expense lines for drugs, durable medical equipment, patient transportation, imaging services, labs and diagnostics, radiation, and chemotherapy
  • Recording fundraising costs as they are incurred

Contact us if you have any questions regarding accounting for expenses for the cost report or would like Simione Healthcare Consultants to prepare your cost report.

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