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CMS Proposes Changes to Medicare Cost Reports

The Centers for Medicare & Medicaid Services (CMS) proposes changes to the Medicare cost report and the accompanying instructions. CMS announced its intention to make changes to the Form CMS-2552-10, or the Hospital and Health Care Complex Cost Report, in a notice of proposed information collection.

To comply with the Paperwork Reduction Act of 1995, CMS must solicit public comment, and the Office of Management and Budget (OMB) must approve the collection request.

Medicare providers must submit cost reports to CMS annually; the reports are used for reimbursement and analytical purposes. The proposed changes include the addition of a new worksheet S-12, which will be used by hospitals to report median Medicare Advantage organization negotiated charges by Medicare severity diagnosis related group (MS-DRG), as mandated by the fiscal year 2021 Inpatient Prospective Payment system (IPPS) final rule. CMS also proposes to add a line on worksheet G-3, statement of revenues and expenses, to report the aggregate revenue received for COVID-19-related funding, including from the Provider Relief Fund. Additionally, CMS proposes a line for hospitals to report their COVID-19 temporary expansion beds on worksheet S-3.

CMS also proposes changes to the worksheet S-10 on hospital uncompensated and indigent care data to:

  • include only charges related to general short-term inpatient and outpatient services billable by the hospital in determining uncompensated care while excluding charges related to other parts of the hospital complex, such as psychiatric units or skilled nursing facilities;
  • calculate the cost-to-charge ratio (CCR) using costs and charges for the general short-term hospital only;
  • apply the CCR to charity care provided to uninsured patients and insured patients not covered for the entire hospital stay;
  • recognize an inferred contractual relationship between an insurer and a provider when the provider accepts an amount from an insurer as payment, or partial payment, on behalf of an insured patient; and
  • add two exhibits requiring detailed listings of charity care and total bad debts.

CMS is accepting comments on the proposed changes until Jan. 11.

Contact Senior Director of Policy Erin O’Malley at or 202.585.0127 with questions.


About the Author

Shahid Zaman is a senior policy analyst at America's Essential Hospitals.

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