OIG: MACs miss mark on cost reports
By HME News Staff
Updated 10:34 AM CDT, Thu March 20, 2025
WASHINGTON – Medicare Administrative Contractors did not consistently meet Medicare cost report oversight requirements, according to a new report from the Office of Inspector General.
For federal fiscal years 2019–2021, each of the 12 MAC jurisdictions failed to comply with the contract requirements for audit and reimbursement desk review and audit quality (AR-4) for at least one of the three years.
CMS identified 287 total audit issues among all MAC jurisdictions during the audit period, including MACs not performing proper reviews; inadequate review of graduate medical education and indirect medical education reimbursement; improper review of allocation, grouping, or reclassification of charges to cost centers; improper calculation and reimbursement for nursing and allied health programs; and inadequate review of bad debts.
MAC officials from selected jurisdictions suggested multiple causes for the findings, including unclear guidance from CMS, limited feedback on the cost report reviews, inadequate training, and staffing and workload issues.
The OIG recommended CMS improve its efforts to ensure that MACs meet their cost report oversight requirements, including increasing transparency about its processes and providing additional training. CMS generally concurred with all three recommendations and has taken steps to address all of the recommendations.
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