Review of Select Medicare Conditions of Participation and Costs Claimed at Hillsboro Area Hospital From April 1, 2004, Through June 30, 2006

Hillsboro Area Hospital (the hospital) was noncompliant with a Medicare Condition of Participation (CoP) because it maintained more inpatient beds than allowed. Specifically, on November 27, 2007, we observed that the hospital maintained 26 beds, one more than the 25 bed limit allowed under the Medicare CoP. The hospital also did not properly disclose $10,800 for related party rental costs and reported $2,000 for unallowable entertainment costs on its Medicare cost reports.