Medicare Cost Report Appeals & Reopenings: Commonly Appealed Issues – A Deep Dive Webinar Recap

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Medicare providers continue to face complex reimbursement challenges when filing Medicare Cost Reports. Understanding which issues are most frequently disputed before the Provider Reimbursement Review Board (PRRB) is essential for protecting revenue and maintaining compliance.

On June 17, 2026, The Hospital Finance Academy hosted the second session in its appeals webinar series: “Commonly Appealed Issues: A Deep Dive.” The session was presented by Kristin L. DeGroat, Chief Legal Officer at Besler Holdings, Inc., along with Leslie Goldsmith, Member, and Page M. Smith, Associate, both from Bass, Berry & Sims, PLC.

This recap highlights the key issues discussed and the practical guidance provided for hospitals and health systems.

PRRB Appeals: Continuing the Conversation

The webinar opened with a refresher on PRRB jurisdiction. Providers must meet all jurisdictional requirements, including dissatisfaction with a final determination, timely filing within 180 days, and the required amount in controversy ($10,000 individual / $50,000 group). Medicare Cost Reports remain the foundation for identifying appealable issues, and protesting items correctly on the cost report is a substantive payment requirement.

Most Commonly Appealed PRRB Issues

The speakers identified the following issues as those most frequently appealed to the PRRB:

• Operating and Capital Disproportionate Share Hospital (DSH) Payments
• Wage Index
• Base Rate Standardized Amount
• Graduate Medical Education (GME) and Indirect Medical Education (IME)
• Nursing and Allied Health Education (NAHE)
• Quality Reporting Payment Reductions
• Medicare Bad Debt
• Sole Community Hospital (SCH) / Medicare Dependent Hospital (MDH) Status
• Volume Decrease Adjustments

Each issue was examined in detail, with special attention given to recent regulatory changes and significant case law.

Operating & Capital DSH

Traditional operating DSH (now representing 25% of DSH payments) remains appealable, particularly regarding Medicaid eligible days, Part C days, 1115 waiver days, adolescent psychiatric days, and SSI data match issues. Capital DSH was affected by the Toledo Hospital v. Becerra decision, leading to a prospective rule change effective for discharges on or after October 1, 2023. Hospitals with pre-2024 discharges should continue to protest and appeal.

Wage Index

Appeals often arise from the annual wage index reconciliation process and methodology changes. The Citrus HMS. LLC v. Becerra decision clarified how rural floor calculations must include reclassified urban-to-rural hospitals.

GME / IME

These payments use different FTE counting rules (three years for DGME, one year for IME) and are subject to FTE caps established in 1996. Disputes frequently involve weighting factors and available bed counts.

Volume Decrease Adjustments

Recent success has been achieved following the D.C. Circuit’s Lake Region decision (September 2024), which required CMS to recalculate the adjustment to fully compensate hospitals for fixed costs. The PRRB is now issuing decisions consistent with this ruling.

Other topics covered included Medicare bad debt collection efforts, SCH/MDH status determinations, and quality reporting payment reductions (where appeals at the PRRB level have historically been challenging).

Key Takeaways

The webinar emphasized several practical points for providers:

• Many issues require early identification and proper protesting on the Medicare Cost Report.
• Recent case law and regulatory changes create new appeal opportunities, especially for Capital DSH and Volume Decrease Adjustments.
• Documentation standards remain critical for issues such as Medicare bad debt and indigency determinations.
• Strategic timing and issue selection can improve outcomes when pursuing PRRB appeals.

Final Thoughts

Disputed cost report issues can have significant financial implications. A clear understanding of the most commonly appealed topics, combined with timely action and strong documentation, helps providers protect Medicare reimbursement.

Contact the expert team at Besler Holdings for more information or help with your organization’s Medicare Cost Report appeal and/or reopening.

Related Webinars

Part 1: Medicare Cost Report Appeals & Reopenings: What You Need to Know – On-Demand Now
Part 3: Medicare Cost Report Appeals & Reopenings: Best Practices – On-Demand Now

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