Update: CMS Clarifies Instructions for Revising Worksheet S-10:

What You Need to Know

revised-CMS-instructions-Worksheet-S10As outlined in our most recent blog post, the Centers for Medicare and Medicaid Services (CMS) extended the deadline for submitting revisions to Worksheet S-10s for FY 2014 and FY 2015. In line with that announcement, CMS also released Transmittal 11 on September 29, 2017. CMS clearly stated the purpose of the transmittal:

“This transmittal clarifies the definitions and instructions for uncompensated care, non-Medicare bad debt, non-reimbursed Medicare bad debt, and charity care to include uninsured discounts, as well as modifies the calculation relative to uncompensated care costs.”

Clarifying the instructions for Worksheet S-10 has been a consistent theme cited by hospitals since CMS announced its intentions to utilize Worksheet S-10 as part of the uncompensated care calculation formula. The need to clarify these instructions was one of the reasons this formula was removed from the 2017 Hospital Inpatient PPS Final Rule and even though the formula was contained in 2018 Final Rule, CMS has recognized the need to refine these instructions.

While the majority of the information contained in the transmittal codified assumptions that hospitals had been using, and while we anticipate that the overall impact to Worksheet S-10 data will be minimal, there were certain points that we highlighted as having an impact on that data:

  • Expanding the definition of charity care to include discounts given to uninsured patients that meet the hospital’s financial assistance policy/uninsured discount policy;
  • Clarifying Line 20 Column 1 to include charges for non-covered services provided to patients eligible for Medicaid or other indigent care programs if such inclusion is specified under the hospitals charity care policy;
  • Clarifying Line 20 Column 2 to include non-covered charges for days exceeding a length-of-stay limit for patients covered by Medicaid or other indigent care programs if such inclusion is specified in the hospital’s charity care policy;
  • Clarifying Line 21 Column 2 to note that coinsurance and deductible amounts are not subject to Cost-to-Charge (CCR) reductions, but non-covered charges for days exceeding a length-of-stay limit are subject to reductions.
  • Clarifying instructions for Line 22
  • Clarifying that the amount reported on Line 26 is net of recoveries
  • Adding Line 27.01 to capture Medicare allowable bad debt for the entire facility
  • Modifying the instructions for Line 28 to only include non-Medicare bad debt expenses
  • Modifying the calculation for Line 29, non-reimbursable Medicare bad debt is no longer subject to CCR reduction, while non-Medicare bad debt remains subject to reduction.

What Does This Mean for Hospitals?

Hospitals should review the instructions presented in Transmittal 11 to understand how they compare to any assumptions used in preparing your Worksheet S-10s—especially the Worksheet S-10s for those fiscal years that will be used in the initial rollout of the new uncompensated care formula. If the assumptions that your hospital used were inconsistent with these instructions, you should revise prior year Worksheet S-10 as soon as possible and make sure that you prepare go-forward year Worksheet S-10s with these instructions in mind.

How Can Healthcare Payment Specialists Help You?

With deep expertise in complex and data-intensive cost report issues, such as Medicare Bad Debt and Medicare DSH, Healthcare Payment Specialists (HPS) is ideally positioned to work with hospitals to deliver Worksheet S-10s that are complete and accurate. Our Uncompensated Care Analytics solution provides hospitals with the core data points needed to complete Worksheet S-10, detailed documentation to expedite the audit process, an analysis of the impact that your Worksheet S-10 results will have on uncompensated care payments and benchmarking against peer hospitals.

Click here to contact us to learn more about how HPS can help your hospital.

Healthcare Payment Specialists

Healthcare Payment Specialists

Founded in 2002, Healthcare Payment Specialists (HPS) provides technology enabled solutions for health care eligibility, government reimbursement and compliance to hospitals and healthcare systems across the country. Using its STINGRAY software platform, HPS delivers solutions on a software-as-a-service (SaaS) basis or through outsourced service engagements.
Healthcare Payment Specialists