Blog, Cost Report, Reimbursement

Top Questions from the Wage Index 101 Webinar

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Cody Wales

Looking for more information about Wage Index on the Medicare Cost Report? BESLER’s Senior Reimbursement Consultant Cody Bales answers your questions from the recent webinar. 

To watch the related Wage Index 101 Webinar, click HERE


  1. If you file a 3-month stub cost report and then a 9-month cost report, will both be reviewed for Wage Index and used in future payment calculations

    CMS will use the longer period (the 9-month period) only.

  2. If you can’t support Housekeeping/Dietary contracted hours, what should the provider use? We realize these are required fields if you don’t have a salary component equivalent.

    The provider should determine the most accurate method for estimating hours that can reasonably be obtained. This may include utilizing BLS statistics, obtaining an average hourly rate for similar work within the same area, conducting time studies, or any combination thereof.

  3. Is Parental Leave pay an allowable CORE related benefit? If yes, where would you report it?

    Parental Leave pay should be considered a salary and should be included in amounts reported on S-3 Part II Col 2. The associated hours should be reported as paid hours in column 5.

  4. On page 7 of the handout, why is the non-labor payment different in the 2 columns?

    The labor and non-labor share of the payment is dependent on whether the wage index is greater or less than 1.0. Currently, if wage index is greater than 1, the labor share is 67.6%; if less than or equal to 1, the labor share is 62% (the total payment is the same).

  5. How often does a provider need to update geographic reclassification adjustment? I think it is every 3 years.

    Yes, once a geographic reclassification is approved, it is in effect for 3 years.

  6. Can you clarify acceptable contract language – if a contract specifies that worked hours are available upon request and the data is provided after the fact, is that acceptable documentation for this purpose?

    The provider may obtain hours from the vendor after the work is performed, as long as the hours ultimately reported are actual hours worked and not estimates/assertions made by the vendor.

  7. To earlier discussion about PTO – if paid time off is reported in payroll with hours and dollars (and not for cash-ins), how is it treated for wage index purposes?

    PTO should generally be reported as salaries/wages for wage index, and the associated hours should be reported as paid hours for wage index.

  8. I may have missed it, but was the hours for severance pay mentioned that need to be calculated?

    Yes – to the extent that severance is paid out as salaries, the associated hours should be included for wage index.

  9. If professional salaries for NPs or PAs are not actually billed to Part B, should they still be reported on Line 5?

    If there are NPs/PAs providing services in a nursing capacity, the salaries and hours do not have to be reported on Line 5.

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