The Medicare Cost Report Certification: The Government Asks Too Much
![handle is hein.journals/healaw13 and id is 118 raw text is: THE MEDICARE COST REPORT CERTIFICATION:
THE GOVERNMENT ASKS TOO MUCH
Ronald J. Nessim and
Benjamin N. Gluck
Bird, Marella, Boxer & Wolpert
Los Angeles, CA
Introduction
All Medicare Part A providers,
including hospitals, must file an annual
cost report within five months of the
end of their fiscal years. A cost report,
which is an extremely complex docu-
ment, categorizes revenue and costs
from the provider's many varied depart-
ments and cost centers, including, to
name only a few for a hospital, inten-
sive care, operating room, radiology,
occupational therapy, outpatient
psychiatric, pharmacy, laundry, and
cafeteria. What costs are allowable and
can be included in the cost report is
subject to complex rules and regulations
that run tens of thousands of pages and
often vary from cost center to cost
center. These regulations put the tax
code to shame.
Thousands of decisions and actions
that are ultimately reflected in the cost
report are made each day. For example,
when a patient is discharged, the
patient's files are reviewed by a coder
who, after reviewing the medical
records, assigns an appropriate diagnos-
tic related group (DRG) code. This
information eventually makes its way to
the cost report. Similarly, each time an
inpatient receives a hospital meal or
each time a psychiatric outpatient
attends a group therapy session, the
event must be logged, usually by a low
level employee, and is ultimately part of
the cost report.
The government and qui tam
relators have brought an increasing
number of cost report fraud cases in
recent years.1 What is striking in many
cases is the overbreadth, the impossibil-
ity, and the absurdity of the
certification the government has
included in the cost report and require-
ments for a senior officer of the
provider to sign:
Part I - Certification
Misrepresentation or falsification of
any information contained in this
cost report may be punishable by
criminal, civil and administrative
action, fine and/or imprisonment
under federal law. Furthermore, if
services identified by this report
were provided or procured through
the payment directly or indirectly
of a kickback or where otherwise
illegal, criminal, civil and admin-
istrative action, fines and/or
imprisonment may result.
Certification by Officer or
Administrator of Provider
I hereby certify that I have read the
above statement and that I have
examined the accompanying elec-
tronically filed or manually
submitted cost report and the
balance sheet and statement of
revenue and expenses prepared by
[Hospital] for the cost report period
beginning [date] and ending [date]
and that to the best of my knowl-
edge and belief, it is a true, correct,
and complete statement prepared
from the books and records of the
provider in accordance with applic-
able instructions, except as noted.
I further certify that I am familiar
with the laws and regulations
regarding the provision of health
care services, and that the
services identified in this cost
report were provided in com-
pliance with such laws and
regulations. (Emphasis added.)
In our experience, the certification
is usually signed by the hospital's CFO,
a person who, while in charge of the
hospital's financial department, is often
far removed from the intricacies of the
preparation of the cost report. Indeed,
even apart from base level data entries
such as those discussed above and made
by perhaps hundreds of different hospi-
tal employees each day, there will often
be a whole team of inside and outside
accountants and lawyers who partici-
pate in the preparation of a cost report.
This article focuses on the final
sentence of the certification. In it the
CFO certifies two things: 1) that he or
she is familiar with the body of law
and regulations regarding the provision
of health care services, and 2) that the
hospital's services, as identified in the
cost report, were provided in compli-
ance with such laws. These statements
are not on information and belief' and
are not limited by the to the best of my
knowledge and belief clause in the
prior sentence of the certification.
After further examining the impos-
sibility of the certification, we consider
a hypothetical and examine whether a
prosecutor or qui tam relator can estab-
lish a prima facie violation if a CFO
signs such a certification without being
familiar with all of healthcare law and
actually knowing that all services were
provided in compliance with the regu-
lations. We also consider what defenses
the CFO may have. Finally, we discuss
how the government should change the
certification to a more realistic and
meaningful one.
Further Examination of the
Last Sentence of the
Certification
As to the familiarity element, it
would be difficult to think of an area of
law other than health care about which
it would be so difficult to assert famil-
iarity with all of the field's laws and
regulations. CFOs are far from the only
people who have trouble gaining famil-
iarity with health care regulations. In
fact, judges, lawyers, and commentators
have complained about them for a
long time.
Even the United States Supreme
Court has trouble understanding
20](ViewImageLocal?handle=hein.journals/healaw13&div=29&collection=&method=preview&ext=.png&size=3)
What Is HeinOnline?
Contact us for annual subscription options:
Already a HeinOnline Subscriber?
profiles profiles most
The Medicare Cost Report Certification: The Government Asks Too Much
Contact us for annual subscription options:
Already a HeinOnline Subscriber?
profiles profiles most