CMS Pub. 100-06, ch. 2, § 30.1

The servicing contractor shall accrue the costs involved and submit a monthly invoice to

the receiving contractor. It shall submit invoices promptly to permit the receiving

contractor to submit its IER on a timely basis. It shall include adjustments to previous

invoices in subsequent invoices. The servicing contractor must have adequate

documentation by cost category to support the invoice amount. It shall not include these

costs in its cost reports.

30.2 - Receiving Contractor - (Rev. 2, 08-30-02)

A1-1302.2, B1-4302.2

The receiving contractor shall include the invoiced amount as subcontract costs in all

appropriate functions and activities on the IER, Contractor Auditing and Settlement

Report (CASR) CMS-1525A, (Intermediaries Only), and FACP submitted to CMS. It

shall include the servicing contractor's name in the Remarks section of the Activity Form.

It shall develop estimates for use in cost reports when the servicing contractor does not

submit an invoice in time for inclusion in the cost report.

40 - Special Cost Reporting Issues - (Rev. 2, 08-30-02)

A1-1303, B1-4303

Shared system costs and CWF satellite costs for ongoing maintenance, as well as for the

other costs of the user groups, e.g., travel, are to be allocated according to the following

instructions.

The general rule for allocating costs when more than one Medicare function/activity is

affected is to allocate time and cost equitably to the activities benefiting from the related

work. There are three generally acceptable approaches for allocating such costs.

Charge ongoing costs to Activity 11001, Bills/Claims Processing, if the work primarily

benefits that activity;

Charge ongoing costs to the activities which benefit from the work, if the benefit can be

demonstrated and is documented; or

If the cost is small and the related work generally benefits all Medicare functions, it may

be allocated to all Medicare activities using the same or similar methodology to that

stated in chapter 1, §90.10, on overhead costs. Note that this is not a statement that such

costs are an overhead cost, but only that such costs may be allocated in the same or

similar manner.