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Related parties? But I hardly know the guy
Caring : National Association for Home Care Magazine
|August 7, 1991
Summary
Medicare auditors limit costs for providers related to suppliers or asset sellers. This article explains how Medicare determines "related parties" and discusses exceptions to these cost limitations.
Area of Science:
- Healthcare Auditing
- Medicare Reimbursement Policy
Background:
- Medicare providers often engage services and assets from related parties.
- Disputes arise regarding the allowability of costs when providers pay higher charges to related entities.
Purpose of the Study:
- To clarify Medicare's criteria for identifying "related parties."
- To examine exceptions and special circumstances affecting related party cost determinations.
Main Methods:
- Analysis of Medicare program guidelines and audit principles.
- Review of regulations pertaining to cost allowability for related party transactions.
Main Results:
- Medicare typically limits allowable costs to the actual costs incurred by the related party.
- Determination of relatedness considers various relationships, including suppliers, landlords, and asset sellers.
Conclusions:
- Understanding Medicare's "related party" rules is crucial for providers to ensure cost allowability.
- Navigating exceptions and specific application scenarios is key to accurate Medicare cost reporting.