Downtown Syracuse Skyline

M.S. Hall Update: New Hires and Changes to Bad Debt Accounting

It’s the start of a new year, and M.S. Hall has jumped into 2021 with some new employees, some new friends, and an exciting promotion. We’ve also seen projects wrap and kept an eye on some key developments in Medicare-Medicaid Bad Debt policy. Read on for more.

Personnel

Since the second half of 2020, M.S. Hall has added six new team members. Joining the Data team are Junyao Liu and Baylie Goddard, each of whom broaden M.S. Hall’s capabilities in terms of data analytics and development in critical ways. And on the Reimbursement side of things, M.S. Hall has added Brenton Moore, Kelly Kilcourse, Robert Lyall, and Stefan Marinkovic, representing an unprecedented expansion in M.S. Hall’s capacity to continue serving healthcare partners across the Northeast. Visit our Team page to get acquainted with all the new teammates at M.S. Hall.

In addition to the new hires, M.S. Hall has promoted a familiar face to the leadership team. Jordan Wood, former Senior Analyst with the Healthcare Transformation team has been promoted to Manager where he will develop M.S. Hall’s strategic design capacities as he works with partners across healthcare and non-profit sectors, building networks of care from a systems design perspective.

Policy and Project Highlights

Dual Eligible Bad Debt Accounting

With the Final Rule announced in the 9/18/2020 Federal Register, CMS clarified its guidance in § 413.89 for Medicare bad debt and contractual allowances. In their clarification, CMS has taken the position that “it is never appropriate for a provider to write off Medicare-Medicaid crossover bad debt amounts to a contractual allowance account simply because they are unable to bill the beneficiary for the difference between the billed amount and the Medicaid claim payment amount. It is likewise inappropriate to present these amounts to Medicare for reimbursement as Medicare bad debts.” This clarification characterizes the accounting practice of writing off Medicare-Medicaid crossover bad debts to a contractual allowance account as an inaccurate classification method and therefore, noncompliant with § 413.20.

CMS received comments arguing that these clarifying amendments to § 413.89 would unnecessarily burden providers by forcing them to change longstanding accounting practices, but CMS has argued that previous guidance offered in the April 4, 2019 MLN SE as well as in the classification requirements set forth in PRM § 320 have provided sufficient reminders of what CMS maintains has been a longstanding policy.

Pursuant to these received comments CMS has revised the proposed amendment, § 413.89(c) by adding paragraph (c)(3)(i) to specify that, for cost reporting periods beginning before October 1, 2020, Medicare bad debts must not be written off to a contractual allowance account but must be charged to an expense account for uncollectible accounts. CMS further specifies that beginning on or after October 1, 2020, Medicare bad debts must not be written off to a contractual allowance account but must be charged to an uncollectible receivables account that results in a reduction of revenue.

It is critical that hospital reimbursement departments assess their accounting practices in relation to dual-eligible bad debts in response to this clarification to prevent unnecessary denials and appeals processes. Failing to adjust practices to align with these newly confirmed guidelines is likely to result in long term operational burden and lost revenues.

We at M.S. Hall + Associates are continuing to monitor how key agencies will interpret and enforce these changes moving forward. These updates have yet to affect ongoing audits that M.S. Hall is currently engaging.

For help complying with these new standards, understanding how your accounting practices may need to adapt, or for any other questions regarding key policy updates, reach out to Mike Sorber (mike.sorber@mshallassociates.com), Hikari Matsuo (hikari.matsuo@mshallassociates.com), or Adam Pitzer (adam.pitzer@mshallassociates) at M.S. Hall + Associates with any questions.

Help Me Grow Learning Community

The end of 2020 brought with it the conclusion of a fruitful partnership between M.S. Hall’s Transformation Team and Help Me Grow Onondaga (HMG), an organization that works to support our area’s parents and children by connecting them to community resources and improving developmental assessment for pre-school aged children. Across six months from July through December 2020, M.S. Hall worked alongside HMG to host a learning community feature three of Syracuse’s most important primary care organizations, Upstate Family Health Center, Syracuse Community Health, and St Joseph’s Health Primary Care West.

By collaborating across organizations, the learning community was able to surface a whole range of needs, barriers, and strategies with respect to how healthcare and social service organizations alike can partner to improve the lives of Onondaga County’s youngest residents.

Client News

Northside Women’s Wellness Center Opens

This month, the collaborative efforts led by the YMCA, St. Joseph’s Health, and the Transforming Communities Initiative has finally come to fruition with the opening of the Northside Women’s Wellness Center on Lodi Street in Syracuse. This new outpost in the city’s historic Northside neighborhood will serve women of the city by providing a comfortable, safe place to exercise, meet, and access childcare too.

The soft open was January 25, 2021.