1. Medicare Cost Report Basics: Reimbursement for Organ Acquisition
Robert Howey
MBA, MHA, CPA
Director, Toyon Associates
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2. Objective After the session, you will be able to:
Understand the Medicare cost report reimbursement methodology, areas of risk, and areas of opportunities
Understand the preparation of the cost report and types of costs included/excluded
Also as it relates to the TFC role

3. Agenda Medicare Cost Report Overview Types of Organ Acquisition Costs
Medicare Reimbursement Methodology

4. Medicare Cost Report Overview

5. What is a Medicare cost report?
Medicare Part A
Report costs to provide services to beneficiaries
Settlement of pass-through reimbursement
Due 5 months after fiscal year end
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6. What is a Medicare cost report? Why is it important?
Cost reimbursement for organ acquisition
Significant revenue opportunity
Complex rules and guidelines
Audit risk
Requires significant effort across multiple departments
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7. What is a Medicare cost report? Why is it important?
What are organ acquisition costs?
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8. Definition of Organ Acquisition Costs
In general, represents the necessary and reasonable costs attributable to acquiring an organ and preparing the potential donor(s) and transplant recipient for organ transplantation.

9. Post-Transplant Follow-Up ORGAN ACQUISITION FOR LIVE DONORS
Operational Management of Medicare Organ Acquisition Cost Centers (Presented by John Rogers and Robert Howey)Section I: Ideas and Strategies for Managing Medicare Organ Acquisition Cost Centers
PRE-TRANSPLANT
Transplant Surgery
Post-Transplant Follow-Up
Evaluation
Maintenance I II
III IV
ORGAN ACQUISITION
FOR RECIPIENTS
ORGAN ACQUISITION FOR LIVE DONORS

10. Types of Organ Acquisition Costs

11. Organ Acquisition Costs
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12. Direct Organ Acquisition Costs
Dedicated Support Personnel (examples):
Administrator/Manager
RN Coordinator
Social Worker
Dietitian
Financial Coordinator
QAPI
Database Administrator
Medical/Surgical Director
Living Donor Advocate
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13. Direct Organ Acquisition Costs
If not 100% organ acquisition activity, complete a TIME SURVEY.

14. Other Direct Costs (examples):
OPO organ fee
Transplant registry fees
Tissue typing of donor and recipient
Physician preadmission transplant evaluation
Other external diagnostic testing
Transportation costs for organ retrieval
Surgeon procurement
Other departmental costs
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15. Direct Organ Acquisition Costs
NOT considered OAC:
Burial expenses for deceased donor
Costs for organs sent outside the U.S.
Living donor travel
Physician backbench preparation
UNOS-required 6-month, 1-year and 2-year follow-up visits
Services related to treatment for the underlying disease
Source: Provider Reimbursement Manual (CMS Pub. 15-1), Sections 3103B, 3106A, 3108C
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16. Organ Acquisition Costs
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17. Hospital Services
TFCs need to be upfront with donors and recipients about their responsibility.
Difference between evaluation and treatment.

18. TRANSPLANT RECIPIENT SERVICES
Operational Management of Medicare Organ Acquisition Cost Centers (Presented by John Rogers and Robert Howey)Section I: Ideas and Strategies for Managing Medicare Organ Acquisition Cost Centers
TRANSPLANT RECIPIENT SERVICES
MEDICARE
NON-MEDICARE
HOSPITAL
PHYSICIAN
Pre-Transplant
Write-off charges and capture for cost report
Reimbursed via C/R
Bill to transplant hospital
Bill to Payer
Capture charges for cost report
Transplant I/P Episode
Bill to MAC
Reimbursed DRG
Bill to Carrier
Reimbursed via Fee Schedule
Bill to payer
Post-Transplant
Reimbursed APC

19. TRANSPLANT LIVE DONOR SERVICES
Operational Management of Medicare Organ Acquisition Cost Centers (Presented by John Rogers and Robert Howey)Section I: Ideas and Strategies for Managing Medicare Organ Acquisition Cost Centers
TRANSPLANT LIVE DONOR SERVICES
MEDICARE
NON-MEDICARE
HOSPITAL
PHYSICIAN
Pre-Transplant
Write-off charges and capture for cost report
Reimbursed via C/R
Bill to transplant hospital
Reimbursed via SAC
Transplant
I/P Episode
Bill to Carrier w/ Q3 modifier
Reimbursed via Fee Schedule
Bill to recipient’s payer
Post-Transplant Follow-Up
Post-Discharge Complications (effective 11/28/11)
Bill to MAC
Reimbursed via IPPS/OPPS
Occ Code 36
Pat Rel Code 39

20. Pre-Transplant Charge Flow: Prospective Recipients
Strategic Management of Organ Acquisition Cost Centers (Presented by John Rogers)Section I: Ideas and Strategies for Managing Medicare Organ Acquisition Cost Centers
Pre-Transplant Charge Flow: Prospective Recipients

21. Pre-Transplant Charge Flow: Prospective Live Donors
Strategic Management of Organ Acquisition Cost Centers (Presented by John Rogers)Section I: Ideas and Strategies for Managing Medicare Organ Acquisition Cost Centers
Pre-Transplant Charge Flow: Prospective Live Donors

22. Organ Acquisition Costs
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23. Common OAC Overhead Costs
Space (Square Footage)
Building
Equipment
Plant Operations
Housekeeping
Capital Related – Depreciation of Building/Equipment, Plant Operations, Housekeeping (Utilizes square footage statistic)
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24. Common OAC Overhead Costs
Employee Benefits (Salaries)
Cafeteria (FTEs)
Administration (Accumulated Cost)
Accounts Receivable (Gross Charges)
Medical Records (Gross Charges)
Nursing Administration (Nursing FTEs)
Social Services (Time Spent)
Are these dedicated or shared units?
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25. Allowable Or Non-Allowable?

26. Medicare Reimbursement Methodology

27. Medicare Reimbursement
Operational Management of Medicare Organ Acquisition Cost Centers (Presented by John Rogers and Robert Howey)Section I: Ideas and Strategies for Managing Medicare Organ Acquisition Cost Centers
Medicare Reimbursement
Medicare Ratio
Medicare Usable Organs X
Total Usable Organs
Medicare Organ Acquisition Reimbursement

28. Medicare Usable Organs
Medicare Ratio
Medicare Usable Organs
Total Usable Organs
Medicare Primary Transplants
Total Transplants
Medicare Secondary Transplants (if Medicare had some liability)
Deceased Donor Organs
Organs Sold to Other Hospitals (e.g., Paired Exchange)

29. Takeaways Accounting for TFC costs: Review policies/procedures
Salary/Benefits
Space
Other overhead
Review policies/procedures
Donor/recipient financial responsibility
Understanding Medicare reimbursement

31. Thank you! Let’s Stay in Touch!
Robert Howey
(888) , ext. 3147

32. Internet-Only Manuals (IOM)
Operational Management of Medicare Organ Acquisition Cost Centers (Presented by John Rogers and Robert Howey)Section I: Ideas and Strategies for Managing Medicare Organ Acquisition Cost Centers
CMS References
Paper Based Manuals
Provider Reimbursement Manual, Part I, Chapter 31
Internet-Only Manuals (IOM)
Medicare Benefit Policy Manual (Pub , Chapter 11, Section 140)
Medicare Claims Processing Manual (Pub , Chapter 3, Section 90)