Audit of IHS Cost Reports

110.1 - Audit of IHS Cost Reports (Rev. 1040, Issued: 08-25-06, Effective: 09-11-06, Implementation: 09-11-06) All IHS hospitals that convert to CAH status are subject to audit by the A/B MAC (A). CMS’ audit policy can be found in Chapter 8, Contractor Procedures for Provider Audit, of Pub. 100-06, Medicare Financial Management Manual. The CAHs are reimbursed under the Medicare Principles of Reasonable Costs. These principles are set forth in the Provider Reimbursement Manual 15-1. For IHS hospitals that do not convert to CAH status, their cost reports are not subject to audit by Medicare.