Current through Register Vol. 46, No. 39, September 25, 2024
[ 1610 ]
(a) The direct assigning of costs is the
process of identifying and assigning costs directly to the functional cost
center generating those costs. Only those costs which meet the definitions and
guidelines established within this section
444.7 of this Article will be
directly assigned.
(b)
Buildings and fixtures
[ 1611 ] The cost of all depreciation or rent/lease of
buildings and fixtures is to be charged to the Depreciation and Amortization
Cost Center (account 8810) and to the Leases and Rental Cost Center (account
8815), respectively, and not reported as a direct expense of specific cost
centers.
(c)
Salary-
and payroll-related employee benefits.
[ 1612 ]
(1)
The salaries and wages cost must be assigned directly to the functional cost
center to which the employee is assigned (see Natural Classification Accounts,
section 444.23(b) of this
Article). For example, for reporting purposes the salary cost of direct nursing
services, including float nurses, must be directly assigned to the patient care
cost centers receiving the service. This assignment may be based on each
employee's actual nursing services, hours performed within each patient care
cost center multiplied by that employee's hourly salary rate while performing
the direct nursing service, or based on an analysis of salary and wage expense
including time and cost studies.
(2) Payroll-related employee benefits must be
reported in the cost center where the applicable employee's compensation is
reported. This assignment can be performed on an actual basis or upon the
following basis:
(i) FICA - actual expense by
cost center;
(ii) pension and
retirement and health insurance (non-union) - gross salaries of participating
individuals by cost center;
(iii)
union health and welfare - gross salaries of participating union members by
cost center;
(iv) all other
payroll-related benefits - gross salaries by cost center.
(3) Non-payroll-related employee benefits are
to be reported in account 8830 (Employee Benefits-Non-Payroll-Related).
(d)
Medical
supplies and durable medical equipment.
[ 1613 ]
(1)
The invoice/inventory cost of all medical and surgical supplies for which a
separate charge is made, except home program dialysis supplies, must be
reported as a cost of the Medical Supplies-Sold cost center (account 7110). The
related revenue must be reflected in the Medical Supplies-Sold revenue center
(account 4110). Home program dialysis supplies must be reported as a cost of
the appropriate home program dialysis center.
(2) Medical and surgical supplies and
materials issued by Central Services and Supplies for which a separate charge
is not made must be reported at invoice/inventory cost as a cost of the cost
center using the supplies and materials.
(3) Effective for cost reporting periods
beginning January 1, 1982, the invoice/inventory cost of all durable medical
equipment sold must be reported as a cost of the Durable Medical Equipment-Sold
cost center (account 7130). The related revenue must be reported in the Durable
Medical Equipment-Sold revenue center (account 4130).
(4) Effective for cost reporting periods
beginning January 1, 1982, the depreciation expense associated with durable
medical equipment leased or rented must be reported in the Durable Medical
Equipment-Leased/Rented cost center (account 7140). The related revenue must be
reported in the Durable Medical Equipment-Leased/Rented revenue center (account
4140).
(5) The overhead associated
with the issuance of medical supplies and durable medical equipment must be
reported in the Central Services and Supplies cost center (account 8460). The
cost of reusable patient chargeable supplies must remain in the Central
Services and Supplies cost center.
(e)
Drugs.
[ 1614 ] Pharmaceutical supplies and materials
including IV solutions, admixtures, blood derivatives, etc.) issued by the
Pharmacy cost center for which a separate Pharmacy charge is made must be
reported for as a cost of the Drugs Sold cost center (account 7150). The
related revenue must be reflected in the Drugs Sold revenue center (account
4150).
Pharmaceutical supplies and materials including IV
solutions, admixtures, blood derivatives, etc.) issued by the Pharmacy for
which a separate charge is not made must be reported at invoice/inventory cost
as a cost of the cost center using the supplies and materials.
The overhead associated with the issuing of
pharmaceutical supplies and materials (including IV solutions, admixtures,
blood derivatives, etc.) must be reported in the Pharmacy cost center (account
8470). The cost of reusable patient chargeable items must remain in the
Pharmacy cost center.
(f)
Data processing.
[ 1615 ]
(1)
All the direct costs incurred in operating an electronic data processing
center, in purchasing data processing services, and/or in obtaining such
services from related organizations, must be reported in the using cost
centers. Direct cost which cannot be directly identified with specific
functional cost centers must be assigned to the functional cost centers using
such services based on each hospital's own determination of a fair and
equitable assignment or allocation concept which gives appropriate recognition
to the types of data processing costs incurred in their data processing center,
under contract, and/or from related organizations.
(2) Effective for cost reporting periods
commencing January 1, 1981 or thereafter, this cost assignment or allocation
concept must be agreed to by the medical fiscal intermediary prior to the end
of the reporting period. Once a basis has been approved, it will remain in
effect until the provider initiates a subsequent request to change
it.
(3) No prior approval is
required for cost reporting periods ending December 31, 1980 or before.
(g)
Central
patient transportation.
[ 1616 ]
(1)
Because patient transportation costs are relatively minor in most hospitals,
direct assignment of this expense is not required. Such expense may be reported
where incurred. However, since no patient transportation cost center is
provided, those hospitals which maintain a central patient transportation
department must report such expenses in the appropriate ancillary services cost
centers. Patient visits or some other valid basis may be used for reclassifying
such expenses.
(2) The expenses
incurred in transporting patients to the Daily Hospital Services areas at the
time of admission are to be assigned to the Inpatient Admitting cost center
(account 8524). The expenses incurred in transporting patients who have been
discharged are to be assigned to the Daily Hospital Services functional cost
center from which the patient was discharged.
