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Medicare-Related Capital Costs Reported by New Hospitals

Hospitals are paid through Medicare Part A for Medicare-related capital costs (such as depreciation, interest, rent, and property-related insurance and tax costs). Most hospitals receive payment for capital costs through the Medicare Inpatient Prospective Payment System (IPPS) whereby a portion of their payment for each patient discharge is intended to cover capital costs. New hospitals can be exempted from the IPPS and be paid on a cost basis for their first 2 years of operation. We will determine whether new hospitals claimed Medicare-related capital costs in accordance with Federal regulations.

Announced or Revised Agency Title Component Report Number(s) Expected Issue Date (FY)
May 2021 Centers for Medicare and Medicaid Services Medicare-Related Capital Costs Reported by New Hospitals Office of Audit Services W-00-21-35870 2022