LAC 50:XXI.715. Allowable Costs

EDITOR’S NOTE: The provisions of this Section were previously located in LAC 50:XXI.2907. A. Allowable costs include those costs incurred by providers to conform to state licensure and federal certification standards. General cost principles are applied during the desk review and audit process to determine allowable costs. 1. These general cost principles include determining whether the cost is: a. ordinary, necessary, and related to the delivery of care; b. what a prudent and cost conscious business person would pay for the specific goods or services in the open market or in an arm’s length transaction; and c. for goods or services actually provided to the center. B. Through the desk review and/or audit process, adjustments and/or disallowances may be made to a provider’s reported costs. The Medicare Provider Reimbursement Manual is the final authority for allowable costs unless the Department has set a more restrictive policy.