Section 1200-13-02-.05 - COST REPORTS(1) TennCare, in consultation with the Comptroller and THCA, shall develop the cost report format and submission process to be followed by participating Medicaid NFs. Medicaid participating NFs are required to file annual cost reports in accordance with the following: (a) Medicaid participating NFs are required to report their allowable costs on the following cost reports: 2. Medicaid Supplemental Cost Report(b) The version of the Medicaid supplemental cost report required to be filed by the NF providers is the most recently available cost report version on TennCare's website as of the end date of the provider's fiscal year, unless notified by TennCare to use an alternate version. Older versions of the cost report will not be accepted.(c) All proposed updates and changes to the Medicaid supplemental cost report will be shared with NF industry stakeholders prior to their implementation to ensure the provider community has ample notice and understanding of the changes.(d) Separate cost reports must be submitted by the home office, central office, or related party management companies when costs of the entity are reported in the NF provider's Medicare cost report or Medicaid supplemental cost report. The Medicare home office cost statement (CMS Form 287-05, or its successor), or an equivalent document must be filed with the provider's cost report submission package.(e) Cost reports must be submitted annually. The due date for filing annual cost reports is the last day of the fifth (5th) month following the NF provider's fiscal year-end. The year-end utilized for the Medicare cost report and the Medicaid supplemental cost report must be the same.(f) Changes of Ownership. In the event of a change in ownership (CHOW) of the NF, the previous owner shall be required to submit a final cost report, both Medicare and Medicaid supplemental cost reporting forms, from the date of its last fiscal year-end to the date of sale or lease. 1. The previous owner must file a final cost report pursuant to Subparagraph (i).2. If the new legal entity continues the operations of the NF as a provider of Medicaid services, the new legal entity shall be required to furnish TennCare with an initial cost report from the date of purchase or lease to the new fiscal year-end selected by the new legal entity.(g) Initial Cost Report. The initial cost report submitted by all providers of NF services under the Medicaid program shall be based on the most recent fiscal year-end, and must be filed by the last day of the fifth (5th) month following the NF provider's fiscal year end. The year-end utilized for the Medicare cost report and the Medicaid supplemental cost report must be the same. 1. TennCare at its discretion may allow for exceptions to the initial filing period.2. Subsequent cost reports shall be submitted annually by each NF provider by the last day of the fifth (5th) month following the NF provider's fiscal year-end.(h) New Nursing Facility Provider. A new NF provider may select an initial cost reporting period of at least one (1) month but not to exceed thirteen (13) months. The NF provider's cost report must be filed by the last day of the fifth (5th) month following the NF provider's fiscal year-end. Thereafter, the cost reports shall be submitted according to the guidelines for subsequent cost reports as defined in Subparagraph (e).(i) Final (Terminating) Cost Reports. When a NF provider ceases to participate in the Medicaid program, it must file a cost report covering a period up to the effective date the NF provider ceases to participate in the program. Depending upon the circumstances involved in the preparation of the NF provider's final cost report, the NF provider may file for a period not less than one (1) month and not more than thirteen (13) months. The previous entity has until the end of the fifth (5th) month following the effective date the NF provider ceases to participate in the Medicaid program or the effective date of the CHOW (whichever applies) to submit the final cost report.(j) There shall be no automatic extension of the due date for the filing of cost reports. If a NF provider experiences unavoidable difficulties in preparing its cost report by the prescribed due date, a written request for an extension may be submitted to TennCare prior to the due date. 1. TennCare will have sole authority in approving both the extension and extension time frame.2. Prior to approving a request for an extension, TennCare maintains the right to request additional information and supporting documentation from the NF in order to support the extension request.(k) Amended Cost Reports. The Comptroller may accept amended cost reports in electronic format for a period of up to twelve (12) months following the end of the cost reporting period, with the caveat that cost reports may not be amended after an audit or desk review has been initiated. TennCare maintains the right, at its discretion, to supersede the amended cost report filing caveat. Amended cost reports should include a letter explaining the reason for the amendment, an amended certification statement with original signature, and the electronic format completed amended cost reports. Each amended cost report submitted should be clearly marked with "Amended" in the file name.(2) The Medicare and Medicaid supplemental cost reports must meet all of the following minimum criteria to be deemed acceptable cost reports: (a) The NF Medicare and Medicaid supplemental provider and home/central office cost reports must be filed in the electronic format prescribed by TennCare.(b) The Medicaid supplemental cost report version utilized by the NF provider must be the most current version as of the end of its cost reporting period unless notified by TennCare to use an alternate version.(c) The cost reports must include all supporting documentation as required by the Medicaid supplemental cost report instructions and checklist.(d) Cost reports must be prepared according to Medicaid supplemental cost reporting instructions, CMS Publication 15-2, cost reporting instructions, and definitions of allowable and non-allowable costs contained in CMS Publication 15-1. The CMS publications will dictate allowable and non-allowable costs, except where Medicaid reimbursement rules and Medicaid supplemental cost reporting instructions are more specific as to the allowability of certain costs.(e) Medicaid specific accounting principles and allowable cost rules are as follows: 1. Only the straight-line method of computing depreciation is permitted.2. Bad debt is not an allowable expense.3. Costs may be included only for covered services as defined by federal regulations at 42 C.F.R. 483 Subpart B and TennCare.4. Allowable cost must be adjusted for NF compensation limitations as detailed in Rules 1200-13-06-.11 and .12.5. All cost report information shall be submitted consistent with generally accepted accounting principles unless state and federal rules and regulations require a separate treatment of an item. The accrual method of accounting is the only acceptable method for NF providers.6. The Medicare cost report may allow more than one option for classifying costs according to CMS Publication 15, Provider Reimbursement Manual; however, Medicaid will only recognize costs in the cost component totals and direct care floor limit calculations based on the definitions of those cost components contained in this Chapter. If a NF provider classifies cost on the Medicare cost report in a manner other than in compliance with this Chapter, then the cost will be excluded from the applicable cost components and the direct care floor calculation, unless adjusted at audit or desk review.7. The Medicaid NF assessment is an allowable cost to the Medicaid program; however, the NF assessment will be included in the excluded cost component for rate setting purposes.(f) The Medicare and Medicaid supplemental cost reports must include consideration of all prior year adjustments and observations from Medicare and Medicaid audits, desk reviews, and settlements. Unresolved or protested prior year adjustments and observations should be noted in the cost reports or in a separate letter filed with the cost reports but cannot be disregarded.(g) Patient Accounts and Patient Funds. Gross charges to the patients' accounts must match the charges to the patient log. Adjustments to the patients' accounts must then be made to bring the actual charges in line with the contractual and legal collection limits of the various medical programs. All charges in the patients' accounts must be supported by charge slips and the proper notes in the patients' files and must correspond to the charges reported on TennCare billing forms. Personal funds held by the provider for Medicaid patients used in purchasing clothing and personal incidentals must be properly accounted for with detailed records of amounts received and disbursed and shall not be commingled with NF funds. Patient funds in excess of $100 per patient must be kept in an insured interest bearing account. Interest earned must be credited to the patients. Bank fees or charges associated with resident trust fund accounts shall not be charged to or debited against individual resident trust fund accounts.(h) Patient Logs and Census. Each facility must maintain daily census records and an adequate patient log. The format of the log is to be determined by each individual provider and may be combined with the revenue journal or other records at the convenience of the provider. This log must be sufficient to provide the following information on an individual basis and to accumulate monthly and yearly totals for Medicaid patients and for all other patients: 2. Charges for items and services covered by the Medicaid NF Program;3. Charges for items and services not covered by the Medicaid NF Program;4. Patient income applicable to the cost of covered items and services received by Medicaid NF patients;5. Amounts collected and receivable from the Medicaid Program; and6. Amounts collected and receivable from all other sources.(i) Patient Log. 1. Suggested Patient Log. The headings below should be listed across the top of the page above the respective columns. | Column No. | Heading |
(i) | Patient Name |
(ii) | Patient Days |
(iii) | Room and Board Charge |
(iv) | Total Other NF Covered Charges (Non-Room and Board) |
(v) | Total NF Covered Charges (Col. 3 + Col. 4) |
(vi) | Total NF Non-covered Charges |
(vii) | Total Actual Charges (Col. 5 + Col. 6) |
(viii) | Date Medicaid NF Claim Paid |
(ix) | Amounts Collected and Receivable from NF Program |
(x) | Patient Income Applicable to NF Covered Services |
(xi) | Amounts Collected and Receivable from Patients from NF Non-covered Services |
(xii) | Amounts Collected and Receivable from Other Sources |
(xiii) | Total Amounts Collected and Receivable |
(xiv) | Comments |
2. Directions for Completion of the Patient Log. The log should be maintained on a monthly basis with separate pages used for each month. Medicaid NF patients should be listed in a separate section of the log so that Medicaid NF program statistics can be generated. The columns should be completed and totaled as soon after the end of the month as the figures are available. Adjustments should be made to the monthly totals to reflect adjustments in the log due to changes in patient status, additional information, or other reasons. Complete explanations should accompany each adjustment. For non-TennCare patients, columns 8 through 14 can be omitted or adapted for other uses.(3) Auditing of Cost Reports. The cost reports filed in compliance with this Chapter and all applicable provider records shall be subject to audit or desk review by the Comptroller. The cost reports filed in compliance with this Chapter must provide adequate cost and statistical data. This data must be based on and traceable to the provider's financial and statistical records and must be adequate, accurate and in sufficient detail to support payment made for services rendered to beneficiaries. This data must also be available for and capable of verification by the Comptroller. The provider must permit the Comptroller to examine any records and documents necessary to ascertain information pertinent to the determination of the proper amount of program payments due. Data reflected on the cost report which cannot be substantiated may be disallowed.(4) Records Retention. Each Medicaid participating provider of NF services is required to maintain adequate financial and statistical records which are accurate and in sufficient detail to substantiate the cost data reported. These records must be retained for a period of not less than ten (10) years from the date of the submission of the cost report, and the provider is required to make such records available upon demand to representatives of the Department of Finance and Administration, the Comptroller of the Treasury, or the United States Department of Health and Human Services.Tenn. Comp. R. & Regs. 1200-13-02-.05
Original rule filed January 18, 1979; effective March 5, 1979. Rule renumbered as 1200-13-02-.06. New rule filed June 2, 1988; effective July 17, 1988. Repeal filed May 5, 2009; effective July 19, 2009. New rules filed May 1, 2018; effective 7/30/2018.Authority: T.C.A. §§ 4-5-202, 71-5-105, 71-5-109, and 71-5-1413.