Reimbursement Consulting

LBMC has been a recognized firm in healthcare consulting for more than 20 years. Our dedicated team provides a wide range of services, including cost report preparation and review, and reimbursement consulting services for both cost-based and PPS providers. We provide payor negotiations, contracting services, chargemaster reviews and strategic pricing adjustments to meet today’s need for more transparency in healthcare pricing.

Our unique partnership approach enables healthcare providers to anticipate potential changes in reimbursement rates by proactively monitoring operational changes throughout the year, eliminating rate setting surprises. At LBMC, we understand the importance that cost reporting and reimbursement hold for healthcare entities and offer a wide variety of services to help you reach your goals.

Learn more about our services.

ALERT: CMS 2552-10 Chapter 40 Transmittal 18 Provider Cost Reporting Forms and Instructions


CMS issued a Transmittal 18 on December 29, 2022, for the hospital cost reporting Form 2552-10. Several changes were made in this transmittal, but what affects almost all hospital providers are the updated Medicare Bad Debt (Exhibit 2a) and S-10 (Exhibits 3b and 3c) exhibits below which were made a requirement in this transmittal. These exhibits are required for cost reporting periods ending on or after September 30, 2023.

  • Exhibit 2a – Medicare bad debt log for cost report periods beginning Oct 1, 2022 and after
  • Exhibit 3b – S-10 log for charity care charges
  • Exhibit 3c – S-10 log for total facility bad debts

More detail of Transmittal 18:

LBMC is prepared to assist all providers regulated by this transmittal and to assist in the preparation of these exhibits.


What affects almost all hospital providers are the updated exhibits below which were made a requirement in this transmittal. This transmittal affects providers for cost reporting periods beginning on or after October 1, 2022.

  • Exhibit 1 – Allocation of Physician Compensation
  • Exhibit 2 – Medicare bad debt log for cost report periods beginning prior to Oct 1, 2022.
  • Exhibit 2a – Medicare bad debt log for cost report periods beginning Oct 1, 2022 and after
  • Exhibit 3a – Medicaid eligible days for a DSH eligible hospital
  • Exhibit 3b – S-10 log for charity care charges
  • Exhibit 3c – S-10 log for total facility bad debts

ALERT: FY23 Appropriations Bill Update

The 2023 appropriations bill provides for funding levels for several rural health programs.  It was signed by President Biden December 29, 2022.

$5 million was designated in this bill to establish an Office of Rural Health at Centers for Disease Control and Prevention (CDC). This Office of Rural Health at the CDC will enhance implementation of CDC’s rural health portfolio, coordinate efforts across CDC programs and develop strategic plan for rural health.

This bill also supports rural hospitals and core rural health care programs, as listed below:

Rural Hospital Programs

  • $3.45 billion for the Rural Community Facilities Program and $2 million for the Rural Hospital Technical Assistance Program through the United States Department of Agriculture Rural Development (RD) programs.
  • $64.3 million for the Medicare Rural Hospital Flexibility Grants Program (an increase of more than $2 million over FY 2022 funding levels). The $64.3 million includes $21 million for the Small Rural Hospital Improvement Grant Program and $5 million to continue funding the Rural Emergency Hospital (REH) TA Program.

Continuation of Core Rural Health Care Programs

  • $12.5 million for State Offices of Rural Health (level funding)
  • $145 million for the Rural Communities Opioids Response Program ($10 million increase)
  • $12.5 million for the Rural Residency Development Program ($2 million increase)
  • $125 million for the National Health Service Corps ($3 million increase)
  • $8 million for the Rural Maternity and Obstetrics Management Strategies (RMOMS) Program at HRSA ($2 million increase)

Statutory Pay-As-You-Go Act (PAYGO) of 2010

The Statutory Pay-As-You-Go Act (PAYGO) of 2010 required a mandatory spending and revenue legislation to not increase the federal budget deficit.  The PAYGO sequester was waived through 12/31/22 with the passage of the American Rescue Plan Act.  PAYGO sequester is now deferred until January 2025, which avoids a 4% cut to Medicare reimbursement.


Telehealth flexibilities will now continue until December 31, 2024. In the FY 2022 omnibus appropriations bill extended telehealth flexibilities for 151 days post-PHE. The bill extends these critical PHE provisions, including audio-only flexibilities through December 31, 2024.

Medicare Payments

  • Low-Volume Hospital (LVH) and Medicare-Dependent Hospital (MDH) designation both extended through September 30, 2024.
  • Ground Ambulance add-on payments extended for two years through December 31, 2024.
  • Physician add-on payments for services furnished in calendar year 2023, the add-on payment will be 2.5 percent for physicians. For services furnished in calendar year 2024, the add-on payment will be 1.25 percent.
  • Home health rural add-on payment at one percent through the end of 2023.

Mental Health Provisions

  • Coverage of Marriage and Family Therapists (MFT) and mental health counselors (MHC) under Medicare.
  • Inclusion of 200 new residency slots for psychiatry or psychiatry subspecialties. In FY 2026, the Secretary shall begin distribution of these slots, with a minimum of 10 percent going toward hospitals located in rural areas.
  • Inclusion of the Restoring Hope for Mental Health and Well-Being Act

Here is the link to the American Hospital Association notice regarding this $1.7 trillion omnibus bill.

Reimbursement Consulting Services

Cost Reporting Services

  • Preparation and/or review of Medicare and/or Medicaid Cost Reports.
  • Review and assistance with tentative settlements, cost report audits, appeals and other correspondence with CMS and MACs.
  • Review of previously filed cost reports in order to identify potential exposure and reimbursement opportunities.
  • Compilations or independent review of various Medicaid and other State Program Reports such as Residential Treatment Centers.

Payor Contracting and Negotiations

  • Chargemaster Reviews
  • Review all current contracts for compliance, performance and renegotiate with payors, as appropriate, to obtain more favorable contract conditions and/or rates.
  • Review all new contract proposals and recommend acceptance or denial, based on potential performance and fit with the group’s strategy and goals.
  • Review payor market shares in your area and new contract recommendations.
  • Provide telephone and email support to your staff on questions related to payor contracts.
  • Provide ongoing monitoring of contracts for payor compliance.
  • Project environments: Hospitals, ASC, Rehab, Psych (inpatient and outpatient), Physicians (hospital and non-hospital based) and Ancillary services.

Consulting Services

  • Identify and assist with opportunities for Disproportionate Share (DSH) and Low Income (LIP) reimbursement for medical/surgical and rehabilitation hospitals, respectively.
  • Assist in compiling and/or review of traditional Medicare Bad Debts and Medicaid “crossover” Bad Debts.
  • Square Footage Analysis for proper cost allocations.

Other Reimbursement Services

  • Assist with Wage Index audits and review for potential Geographic reclassifications.
  • Consultations for various Provider based issues.
  • Assistance with completion and filing of occupational mix surveys.
  • Due diligence to assist with opportunities and liabilities with acquisition/merger activities.

Types of Clients Served

  • Acute care hospitals (ACH)
  • Behavioral health hospitals (BHH)
  • Critical access hospitals (CAH)
  • Dialysis centers
  • Federally qualified health centers (FQHCs)
  • Home health care
  • Home offices
  • Hospice facilities
  • Long-term acute care hospitals (LTACH)
  • Nursing homes
  • Physician practices
  • Rural health clinics (RHCs)
  • Skilled nursing facilities (SNFs)

Reimbursement Consulting Leadership