RO Monitoring of SA Fiscal Budgets

4642 - RO Monitoring of SA Fiscal Budgets (Rev. 1, 05-21-04) It is the responsibility of the RO to monitor the SA’s performance in adhering to the policies and established guidelines. Specific instructions are provided to the SAs regarding the fiscal management of the funds provided for survey and certification activities. A. Mid-Year Review The RO advises the SAs to review their rate of expenditures to ensure that the Medicare title XVIII budget approval will not be exceeded. (See §4712.) Funds that exceed the SA’s approved budget at the end of the FY may not be paid. B. Supplemental Budget Requests At the direction of the CO, the ROs should instruct the SAs to review their fiscal requirements for the balance of the FY. If it appears that additional funds will be required, the SA should prepare a supplemental budget request. The request for additional funding must be prepared in the same manner as the initial SA budget request, on Form CMS-435. The RO analyzes the State’s request and provides a recommendation for approval to CO for supplemental funding subject to the availability of funds. C. Medicare Fiscal Year Cumulative Report (Form CMS-435) The SAs are to prepare and certify a cumulative FY title XVIII Medicare expenditure report no later than 60 days after the close of the FY and provide notification to the RO. A cumulative expenditure report for the Medicaid program is not required. D. NAR/NATCEP The State is required to conduct these activities as part of its §1864 Agreement as authorized by §1864 of the Act. Refer to §4543 for the allowable expenses. The Survey and Certification Program does not pay expenses incurred for the training of nurse aides. E. State Licensure Costs The CMS’ policy is that total survey costs must be allocated to each benefiting program or activity to determine the payable costs for that program or activity. Knowledge of the State’s licensure requirements is necessary in negotiating the budget to ensure that the State’s share is equitable and in line with current policy. For example, if a Medicare survey covers 100 standards and the State has adopted 50 of these standards as licensing standards, Medicare would cover 100 percent of the survey costs of the 50 Medicare-only standards and the State and Medicare would equally share the survey costs of the other 50 standards. If the State has any non-Medicare standards, the State must bear 100 percent of the survey costs for those standards. For requirements common to all three programs, the State must pay two-thirds of the survey costs (representing the allocation to State licensure and Medicaid), but receives FFP in the Medicaid one-third share. F. Cost Sharing for Title XVIII/XIX Facilities As stated in subsection E above, it is the RO’s responsibility to ensure the proper distribution of costs is made by the SA. The RO informs the States of CMS’ policy concerning this issue. The SAs may not deviate from this policy. The costs of a survey for a title XVIII/XIX facility must be shared equally between Medicare and Medicaid (FFP applicable to title XIX) regardless of the number of beds assigned to each program. The requirements are the same for both Medicare and Medicaid. Consequently, both programs benefit from the survey. Financial Accounts and Reporting The following instructions are provided to assist the SA in the preparation of the Form CMS-435 and Form CMS-434. Please review §§4700 through 4766.