Hospital Financial and Reimbursement Consultants Strategic Reimbursement, Inc. YES - Your Medicare Cost Report Still Matters Strategic Reimbursement, Inc. August 1, 2005

Hospital Financial and Reimbursement Consultants Strategic Reimbursement, Inc. YES - Your Medicare Cost Report Still Matters2 Even the Government Admits that Medicare is Overly Complex “There can be no doubt but that the statutes and provisions in question, involving the financing of Medicare and Medicaid, are among the most completely impenetrable texts within the human experience. Indeed, one approaches them at the level of specificity herein demanded with dread, for not only are they dense reading of the most torturous kind, but Congress also revisits the area frequently, generously cutting and pruning and making any solid grasp of the matters addressed merely a passing phase.” Chief Justice Ervin, U.S. 4th Circuit Court (1994) Rehabilitation Association of Virginia v. Kozlowski

Hospital Financial and Reimbursement Consultants Strategic Reimbursement, Inc. YES - Your Medicare Cost Report Still Matters3 Why Does the Government Still Require Hospitals to Submit Cost Reports?  “Medicare Profitability” used extensively by Congress to determine PPS Inflation Updates  Compliance  Determine Medicare Outlier payment factors  Determine reimbursement from various programs  Determine wage index rates  The main source of statistical and financial data on the hospital industry used by CMS  Reimbursement for Critical Access Hospitals

Hospital Financial and Reimbursement Consultants Strategic Reimbursement, Inc. YES - Your Medicare Cost Report Still Matters4 Do Outside Groups Utilize the Cost Report? Did you know… Hospital quality lists such the Solucient “Top 100 Hospitals” rely extensively on the Medicare Cost Report

Hospital Financial and Reimbursement Consultants Strategic Reimbursement, Inc. YES - Your Medicare Cost Report Still Matters5 Hospital Cost Report Preparation Objectives 1. To insure the Cost Report and supporting documentation have been prepared in compliance with Medicare regulations 2. To insure the Cost Report correctly identifies the full and proper reimbursement due to the hospital 3. To insure the Cost Report properly identifies the related hospital costs

Hospital Financial and Reimbursement Consultants Strategic Reimbursement, Inc. YES - Your Medicare Cost Report Still Matters6 Certification – Your Name on the Line When you sign your name to the Medicare Cost Report, you are certifying that you know:  What is in the Cost Report,  What is in your books and records,  The applicable Medicare laws, regulations and instructions,  That all services provided to Medicare patients were in accordance with the law, and  That everything in the Cost Report is in accordance with the law, except as noted.

Hospital Financial and Reimbursement Consultants Strategic Reimbursement, Inc. YES - Your Medicare Cost Report Still Matters7 “Misrepresentations or falsifications of any information contained in this Cost Report may be punishable by criminal, civil and administrative action, fine and/or imprisonment under Federal law.” - Cover page of every Cost Report  Are you confident enough in your Cost Report preparation efforts to risk perjury, fines and potentially jail? Compliance Expectations

Hospital Financial and Reimbursement Consultants Strategic Reimbursement, Inc. YES - Your Medicare Cost Report Still Matters8 Consequences for Lack of Compliance If a hospital’s compliance is questioned, there are potentially large, negative consequences:  Negative publicity for the institution, Board of Directors and hospital executives (CEO, CFO)  Audit issues and related costs of defense  Settlement costs  Corporate Integrity Agreement costs

Hospital Financial and Reimbursement Consultants Strategic Reimbursement, Inc. YES - Your Medicare Cost Report Still Matters9 Cost Report’s Reimbursement Impact 1. Wage Index 2. Outlier Payments 3. Disproportionate Share 4. Direct Medical Education 5. Indirect Medical Education Even with the introduction of PPS, the Cost Report still impacts reimbursement in the following areas:

Hospital Financial and Reimbursement Consultants Strategic Reimbursement, Inc. YES - Your Medicare Cost Report Still Matters10 Reimbursement Impact (cont.) 6. Renal Dialysis PPS Add on 7. Medicare Bad Debts 8. Allied Health Programs 9. Psychiatric Unit Transition 10. Organ Acquisition

Hospital Financial and Reimbursement Consultants Strategic Reimbursement, Inc. YES - Your Medicare Cost Report Still Matters11 Reimbursement Impact (cont.) 11. Medicaid Cost and/or Rates 12. Medicaid DSH Pools 13. Rural Health Clinics

Hospital Financial and Reimbursement Consultants Strategic Reimbursement, Inc. YES - Your Medicare Cost Report Still Matters12 Conclusion: The Cost Report Still Requires Extensive Effort and Attention With so much still riding on your Cost Report, you cannot afford to turn to anyone but the best. Strategic Reimbursement was founded in 1975 with the purpose of helping hospitals prepare their Medicare Cost Reports. Today, our Medicare advisory practice still comprises the backbone of our firm.

Hospital Financial and Reimbursement Consultants Strategic Reimbursement, Inc. YES - Your Medicare Cost Report Still Matters13 SRI History  Founded in 1975  Offices: Chicago, Milwaukee, Nashville, St. Louis, Denver, Phoenix  Staff of 24  Service approximately 250 healthcare providers, many having been clients for over 20 years

Hospital Financial and Reimbursement Consultants Strategic Reimbursement, Inc. YES - Your Medicare Cost Report Still Matters14 Financial and 3 RD Party Services  Medicare, Medicaid Cost Report preparation and/or review  Prior year Medicare Cost Report reviews: “Medicare Compliance / Recoupment Program” (MCRP)  Disproportionate Share Hospital (DSH) Analysis/Verification  Contractual management and reimbursement professional outsourcing: “Interim Director of Reimbursement” (IDOR)  Wage Index reviews for individual hospitals and/or full CBSA’s  Medicare Bad Debt reviews  PRRB Appeal Services  Group appeals: SSI ratio, out-patient Part B blending

Hospital Financial and Reimbursement Consultants Strategic Reimbursement, Inc. YES - Your Medicare Cost Report Still Matters15 Clinical Services  Procedure coding reviews  Medical records chart audits  CDM review  Physician and staff compliance education

Hospital Financial and Reimbursement Consultants Strategic Reimbursement, Inc. YES - Your Medicare Cost Report Still Matters16 Contact Strategic Reimbursement For more information on how Strategic Reimbursement can help your hospital maximize its third party programs, please contact: Robert Gienko President ext 106