CMS Pub. 100-06, ch. 8, § 120.5

Results of the Audit

(Rev. 27, 12-19-03)

At the completion of its audit, the responsible/designated contractor distributes the

audited home office cost statements and the audit adjustment report to all the contractors

that service the providers within the chain.

The results of the audit of the home office cost statement are binding upon all the

servicing contractors. The servicing contractors rely upon this audit to identify the

allowable portion of the home office costs that can be included in their providers’ cost

reports. They use the audited home office cost statements to make any necessary

adjustments to the home office costs claimed by those provider(s) before they make a

final settlement of the related cost reports. If at the request of the servicing contractor,

you as the responsible/designated contractor audited the provider’s records that are

maintained at the home office for specific issues outside the general audit of the home

office cost statement, forward the following information related to those issues to the

servicing contractor.

• The scope of the audit work performed,

• The schedule of audit adjustments with full explanation why they are necessary

and their effect on the provider’s cost report, and

• The results of discussions with home office personnel pertaining to the audit

findings.

All audit adjustments proposed by the responsible/designated contractor pertaining to the

audit of provider records maintained at the home office are binding upon the servicing

contractor. If the servicing contractor has any questions concerning the audit or its

results, it should resolve the issues with the responsible/designated contractor before the

settlement of the provider’s cost report. However, when a disagreement cannot be

resolved, the servicing contractor may request the responsible contractor to obtain an

interpretation from CMS.

The responsible/designated contractor is reimbursed by the servicing contractor for the

costs of auditing provider records maintained at the home office and for any assistance in

preparing appeal position papers.