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Volume 21.02

The U.S. Centers for Medicare & Medicaid Services (“CMS”) have significantly revised the Home Health Agency Cost Report, now identified as Form 1728-20.  The new form is to be used for all cost reporting periods beginning on or after January 1, 2020.  Many agencies have already completed their filing using the new forms; however, many cost reports have not been completed.

The new cost report expanded cost centers including:

  • Telecommunications Technology,
  • Nursing Administration,
  • Medical Records,
  • LPN (previously included with RN),
  • Physical Therapy Assistants (previously reported with physical therapists),
  • Occupational Therapy Assistants (previously reported with occupational therapists),
  • Telehealth,
  • Advertising, and
  • Fundraising.

While there are several changes, in addition to adding cost centers, the most significant change is the addition of Worksheet S-3, Part V which attempts to capture average hourly wage information, based on hours, for both employees and independent contractors.  Many agencies do not have hours for independent contractors who are paid on a method other than hourly, i.e., per-visit.  Agencies need to develop a process for securing hours from independent contractors to report accurate data.  This has already posed problems for many agencies that have already filed for the year ended December 31, 2020.

The new cost report (Form CMS-1728-20) and revised instructions can be secured at The Provider Reimbursement Manual – Part 2 | CMS.  Due to the date the changes were finalized, most agencies will incur significant effort to complete the 2020 filing appropriately.  Do not be unprepared for your 2021 filing.  Discuss the cost report changes with whoever is responsible for your cost report and prepare for 2021.


The Health Group, LLC will be exhibiting at the upcoming 2021 Financial Management Conference and Expo scheduled for Chicago on August 1-3, 2021 and the 2021 Home Care And Hospice Conference and Expo scheduled for New Orleans on October 3-4, 2021.  We hope to see you at one of these programs.