November 9, 2018

Medicare Cost Report Filing: E-Filing or Traditional Filing?

By Timothy Mikita, Supervisor, Advisory Services

Medicare Cost Report Filing: E-Filing or Traditional Filing?

Since April 2018, the Centers for Medicare & Medicaid Services (CMS) has issued two change requests (CR) relating to the Medicare cost report (MCR) e-filing process — CR transmittal number R2075OTN on April 30, and CR number 10611 on June 12, 2018. Both notified providers about the availability of a new streamlined e-filing process, but is it really streamlined?


Prior to this change request, the general process to file a MCR to the Medicare Administrative Contractor (MAC) included the following requirements:

  1. Generate an electronic cost report (commonly referred to as an ECR file) and a human-readable file (PDF or equivalent, also referred to as the print image), using a CMS-approved vendor software.
  2. Submit Worksheet S (certification page) signed by an officer or administrator of the provider. For cost reports for years ending before December 31, 2017, an original signature was required. For years ending on or subsequent to December 31, 2017, an electronic signature is allowed but not required.
  3. Supporting documentation for the cost report was required, including but not limited to the working trial balance, financial statements, Medicare bad debt listings, interns and residents information system data, and etc.
  4. The final MCR package for each provider was to be submitted to the MAC via mail (or hand delivery). This method accounts for approximately 91% of MCR submissions. The other 9% of submissions utilized a hybrid process including both mail and electronic processes.

New Streamlined Filing Process

CMS is now “attempting” to streamline the process of filing a MCR, as there are numerous steps involved once the MAC receives the submission of the MCR package. MACs perform the same steps for approximately 50,000 MCRs submitted each year by providers.

As part of the streamlining, the 2018 Inpatient Prospective Payment System (IPPS) Final Rule allows an electronic signature on the Worksheet S (certification page) for cost reports ending subsequent to December 31, 2017. Effective April 30, 2018, CMS allows providers to electronically submit their MCR package to their MAC (for all Part A providers) using the Medicare cost report e-filing system (MCReF). The MCRef system was created by CMS for the purpose of e-filing MCRs, but is it really less cumbersome? In order to e-file, a provider must have a CMS Enterprise Identity Management (EIDM) account using MCReF. Hence, providers can use the same account used to access their Provider Statistical and Reimbursement Reports (PS&R).

Benefits for CMS’ and MACs

  1. Increases CMS’ access to MCR data submitted by providers.
  2. Eliminates MAC processes for populating the CMS Healthcare Cost Reporting Information System (HCRIS).
  3. Eliminates the need for MACs to enter MCR postmarked date, received date, and HCRIS sent date.
  4. Eliminates manual upload of IRIS electronic health record data.

Benefits for Providers

  1. Large chain organizations can now electronically submit MCRs to one system versus transmitting MCRs to their assigned MAC jurisdiction’s portal or physical mailing address.
  2. Electronic submission will automatically be directed to the correct MAC and eliminate the possibility of submitting an MCR package to the incorrect MAC.
  3. Providers will receive immediate response confirming receipt of the MCR.
  4. Reduced paper usage.
  5. Electronic filing can be performed up until 11:59PM of the filing date.
  6. MCReF has a simple, straightforward user interface with a single screen.


  1. Cumbersome system requiring constant monitoring of passwords, etc.
  2. More than 75% of all providers outsource their compliance work which will now create the need to:
    1. Create additional internal procedures.
    2. Numerous electronic signatures.
    3. Numerous electronic exchanges between the provider / preparer.

Mandatory or Encouraged?

While the new streamlined process is strongly encouraged as it is deemed by CMS to be more efficient, but it is not required that MCRs be filed electronically. MCRs may continued to be filed by mail under the pre-electronic filing process. Providers may select the process they prefer to use for filing — hard copy or electronic – at least for now. It appears that the e-filing process is being phased in to introduce the change to providers but may become the final filing protocol in the future.

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