I.  ANNUAL COST REPORT PROCESS


I1. Is my district ‘eligible’ to submit a SHARS Cost Report?

In order to be eligible to submit a SHARS cost report each ISD must:

  • Be enrolled and approved for participation as an active Medicaid provider for SHARS with Texas Medicaid & Healthcare Partnership (TMHP);
  • Have an active Texas Provider Identifier (TPI) and National Provider Identifier (NPI)
  • Ensure that SHARS services are provided by approved/qualified providers as referenced in the Texas Medicaid Provider Procedures Manual (TMPPM);
  • Meet Texas Education Agency (TEA) standards for delivery of SHARS;
  • Abide by Health & Human Services Commission (HHSC) and TEA rules and regulations;
  • Meet all eligibility requirements and participate in the Random Moment Time Study (RMTS);
  • Bill/claim for SHARS allowable services covered by the TMHP; and
  • Have a trained SHARS Financial Contact

I2. Is my district ‘required’ to submit a SHARS Cost Report?

If the district has met all eligibility and participation requirements, the district must submit an annual SHARS Cost Report. Failure to comply will result in recoupment of all interim SHARS payments received for the year in which the default occurs.  SHARS is governed by the following Texas Administrative Codes: 

  • SHARS program rules (eligibility and participation requirements) are located at Title 1 of the Texas Administrative Code, Part 15, Chapter 354, SubChapter A, Division 25, Rules 1341-1342.
  • SHARS reimbursement rules (cost reports and rates) are located at Title 1 of the Texas Administrative Code, Part 15, Chapter 355, SubChapter J, Division 23, Rule 8443.

I3. What months are covered by the SHARS Cost Report Period?

Texas Health and Human Services Commission (HHSC) requires the SHARS Cost Report reporting period to be a federal fiscal year (FFY) of October 1 through September 30.

I4. When is the SHARS Cost Report due date?

The SHARS cost report is due on or before April 1, following the end of the respective SHARS cost report period (October 1 through September 30).

I5. What happens if the district is unable to meet the April 1 deadline to submit the SHARS Cost Report?

Failure to file a complete and acceptable cost report by the cost report due date will result in recoupment of all interim SHARS payments for the year in which the default occurs.

I6. Can an extension be requested if a district is unable to complete the SHARS Cost Report by April 1?

Yes, written requests for an extension must be received at least 15 working days prior to the original cost report due date, allowing 10 working days for HHSC staff to make a written response. The extension request must clearly explain the necessity for the extension and specify the extension due date being requested. Extension approvals will be granted on a case by case basis and only for good cause.

‘Good cause’ refers to extreme circumstances that are beyond the control of the provider and for which adequate advance planning and organization would not have been of any assistance. Not being aware of the due date, inconvenience of the due date, the preparer being engaged in other work so the cost report cannot be completed, or the preparer or signer not being available to sign the cost report do not meet the criteria for good cause and are not acceptable reasons to grant an extension of the due date for submission of the cost report.

I7. Is SHARS Cost Report Training mandatory?

Yes, SHARS cost report training is mandatory.  Preparers must complete the odd- year cost report training in order to receive training credit to complete both that odd- year cost report and the following even-year cost report.

HHSC offers training each year for providers to meet training requirements.  Only trained individuals will have access to make changes in the cost report system, all individuals that have not met the cost report training requirement will have view only access.

I8. Who is required to go to SHARS Cost Report training?

At minimum, the SHARS Financial Contact who will prepare the online SHARS Cost Report must attend training.  This training is also available and recommended for staff: certifying the cost report and certification of funds forms; compiling the Individual Education Plan (IEP) and one-way trip ratios; and Random Moment Time Study (RMTS) program contacts/staff.

I9. Who can be assigned as a SHARS Financial Contact?

A SHARS Financial Contact or “preparer” may be a contractor/designee, which includes district staff, SSA staff, Co-Op Fiscal Agents, and/or a Vendor. However if staff from the SSA or a vendor assist the district in preparing the cost report, the person signing the two cost report certification forms must be the member district's Chief Financial Officer (CFO), Business Officer, Superintendent, or other official that has signatory authority for the district.

It is required that the “Primary” SHARS Financial Contact be an employee of the district. Each district is responsible for the designee’s actions and/or non-action. Districts must document the authorization of the designee, clearly specifying the services to be provided by the designee. Districts must provide documentation of such authorization if requested. HHSC recommends that any authorization to enter the cost report data into the cost report system be incorporated into the contract with the authorized entity/designee.

I10. When will cost report training occur?

 Cost report training sessions are held in January, February and March of each year.

I11. How do I submit my cost report?

SHARS providers are required to prepare and submit an annual cost report using a web-based system known as the State of Texas Automated Information Reporting System (STAIRS). The system is provided at no charge by the HHSC Rate Analysis Department and its contractor, Fairbanks, LLC.  Cost report instructions and training materials are available on the HHSC Rate Analysis SHARS website. 

For questions and assistance with the cost report you may contact the SHARS Rate

Analyst(s) at: (512) 730-7400 or  ra_shars@hhsc.state.tx.us.

I12. Why is the SHARS Cost Report system asking for the fiscal agent’s contact information?

If the district is a member of an SSA/Cooperative it is important that the fiscal agent contact information be completed. The contact should be the name of the person that can provide answers to cost report questions regarding the allocation of time and costs for shared employees. The purpose of tracking this information is to assist in the facilitation of the desk review process.

I13. Why is the system asking for the vendor’s contact information?

If the district has contracted out it’s SHARS billing it is important that the contact information for the vendor be completed. The contact should be the name of the person than can provide detailed answers to questions regarding the time and costs for employees and other costs reported on the cost report. The purpose of tracking this information is to assist in the facilitation of the desk review process.

I14. My district is a member of a Shared Service Arrangement/Cooperative (SSA/Co-Op). If the SSA/Co-Op provided the services and billed for the students enrolled in my district, is my district, as a member district, still required to submit a SHARS Cost Report?

Districts who are members of a cooperative or shared service arrangement must each submit a separate SHARS Cost Report in order to retain the federal dollars claimed for students enrolled in the member district.

I15. My district is the fiscal agent of a SSA/Co-Op. Can the fiscal agent claim costs for all students that the SSA/Co-Op served during the cost report period?

No, the fiscal agent can only report costs for the students enrolled in the district serving as the fiscal agent. All shared costs must be allocated to each of the member districts.

For example, if a member district contributed 15.75% of their expenditures, that district would be allocated 15.75% of the paid hours and payroll costs for each staff person, as well as 15.75% of any other allowable direct costs.

I16. My district is a member of a SSA/Co-Op. How do I know what my shared costs are for the SHARS Cost Report?

The SSA/Co-Op fiscal agent is responsible for allocating each member district's costs as appropriate.

For example, if a member district contributed 15.75% of their expenditures to the SSA/Co-Op, that district could be allocated 15.75% of the paid hours and payroll costs for each staff person, as well as 15.75% of any other allowable direct costs.

Allocation of salary costs based on actual expenditures is another example of how a fiscal agent may choose to allocate salary costs.  Additional allocation methodologies used to distribute shared costs to member districts of an SSA/Co-Op must be documented and presented to HHSC, if requested.

I17. Can the SHARS Financial Contact for the SSA/Co-Op fiscal agent prepare the cost report for member districts in an SSA/Co-Op?

Yes, a SHARS Financial Contact or “preparer” may be a contractor/designee, which includes district staff, SSA/Co-Op Fiscal Agents, and/or a Vendor. It is required that the “Primary” SHARS Financial Contact be an employee of the district. HHSC recommends that any authorization to enter the cost report data into the cost report system be incorporated into the contract with the authorized entity/designee. Each district is responsible for the designee’s actions and/or non-action. Districts must document the authorization of the designee, clearly specifying the services to be provided by the designee.

If staff from the SSA/Co-Op or a vendor assists the district in preparing the cost report, the person signing the two cost report certification forms must be the member district's Chief Financial Officer (CFO), Business Officer, Superintendent, or other official that has signatory authority for the district.

I18. What does cost allocation methodology mean and how is it used in the SHARS Cost Report?

Cost is allocated using statistics that have been approved by CMS to facilitate the identification of cost associated with Medicaid. There are four key allocation methods used in the SHARS cost report: (1) an allocation method to identify the cost of medical services irrespective of payer and administrative cost; (2) a method for allocating direct medical services costs to the Texas Medicaid program; (3) a method for allocating transportation costs that cannot be direct costed to specialized transportation services; and (4) a method for allocating specialized transportation one-way trip ratio.

1.  The first allocation method is the direct services time study percentage, which reports the amount of time related to all medical services and Medicaid administrative claiming. HHSC provides this number to providers based on a statewide time study

2.  The second allocation method is the ratio of Medicaid covered students with medical IEPs to all students with medical IEPs. Medical IEPs refers to students with IEPs that document the need for a direct medical service. IEP Ratio = (The total number of Medicaid students with IEPs requiring medical services)/(The total number of students with IEPs requiring medical services).

3.  The third allocation method used in this cost report is for transportation costs that cannot be direct costed to specialized transportation services, e.g., fuel, insurance, and/or bus mechanic costs. If costs cannot be direct costed to specialized transportation services, it is acceptable to allocate the costs to specialized transportation services based on the number of specialized transportation vehicles divided by the total number of transportation vehicles.

4.  The fourth allocation method is the ratio of one-way specialized transportation trips provided on a day when medical services pursuant to an IEP were provided divided by the total number of one-way specialized transportation trips. One-way trip ratio = (total one-way trips for Medicaid students with IEPs requiring specialized transportation services)/(Total one-way trips for all students with IEPs requiring specialized transportation services).

I19. How do I get the count for the IEP ratio?

Medical IEPs refers to students with IEPs that document the need for a direct medical service. IEP Ratio = (The total number of Medicaid students with IEPs requiring medical services)/(The total number of students with IEPs requiring medical services)

I20. If a student receives a direct medical service and the school district fails to bill for the interim reimbursement, would that student still be counted in the IEP Ratio, provided all other criteria are met? Maybe parent did NOT give consent or district just missed billing for the student, or we failed to uncover Medicaid eligibility, etc.

The IEP ratio is a Medicaid vs. Non-Medicaid student count. A student's inclusion in the numerator of the IEP Ratio is not dependent on whether the district billed for Medicaid services provided to the student. Rather, it is dependent on the student's Medicaid eligibility. If the student was Medicaid eligible during the reporting period, he or she should be included in the numerator as well as the denominator of the IEP Ratio. If the student was not Medicaid eligible during the reporting period, but did have an IEP for one or more direct medical services during the cost reporting period, he or she should only be included in the denominator.

I21. For the IEP Ratio, am I only to count those students with an IEP who were Medicaid eligible AND had a claim filed?

See response to Question I20

I22. How do I get the one-way trip ratio?

One-way trip ratio = (total one-way trips for Medicaid students with IEPs requiring specialized transportation services)/(Total one-way trips for all students with IEPs requiring specialized transportation services)

Transportation services in a school setting may be reimbursed when they are provided on a specially adapted vehicle. A specially adapted vehicle is one that has been physically modified (e.g. wheelchair lift). The medical need for the special adaptation must be documented in the student's IEP. One-way specialized transportation trips can only be counted on the days when the student used the specialized transportation and the medical services pursuant to an IEP were provided. 

I23. Can I only count the one-way trips to and from the direct service for each student?

No. If the student receives a billable SHARS service (including personal care services on the bus) and is transported on a specially adapted vehicle, the following one-way trips may be claimed:

  • From the student's residence to school
  • From the school to the student's residence
  • From the student's residence to a provider's office that is contracted with the district
  • From a provider's office that is contracted with the district to the student's residence
  • From the school to a provider's office that is contracted with the district 
  • From a provider's office that is contracted with the district to the student's school
  • From the school to another campus to receive a billable SHARS service
  • From the campus where the student receieved a billable SHARS service back to the student's school

A specially adapted vehicle is one that has been physically modified (e.g. wheelchair lift). The need for the special adaptation must be documented in the student's IEP. One-way specialized transportation trips can only be counted on the days when the student used the specialized transportation and the medical services pursuant to an IEP were provided.

I24. If a student meets the criteria for Specialized Transportation, but the district fails to bill for interim reimbursement for those trips, would those trips be counted in the Trip Ratio?

Yes, the unbilled trips would be counted in the ratio. See also response to I21. 

I25. Can all specially adapted vehicles (including cars, suburbans, vans, etc) used by the school district be counted for the SHARS Cost Report or are costs limited only to buses?

Yes. Other vehicles, not only buses, count as long as the vehicle in question meets the definition of “specially adapted.”

A specially adapted vehicle is one that has been physically modified (e.g. wheelchair lift). The need for the special adaptation must be documented in the student's IEP. One-way specialized transportation trips can only be counted on the days when the student used the specialized transportation and the medical services pursuant to an IEP were provided.

For more information on specially adapted vehicles refer to the Texas Medicaid Providers Procedure Manual (TMPPM) – Children’s Services Handbook, Section 3.3.10 Transportation Services in a School Setting at:  TMPPM

I26. Are bus cameras an allowable cost in the SHARS Cost Report?

No, they are not an allowable cost.  They are neither direct medical supplies nor necessary to provide transportation services. 

I27. How are stipends reported on the cost report?

Since stipends are subject to payroll taxes, they should be included with the employee's other salary amounts and reported as salaries on the cost report.

I28. Which direct medical staff's paid hours and costs can be reported on the cost report?

The Random Moment Time Study (RMTS) Participant List is a critical step in allocating costs and ensuring the district remains eligible to receive SHARS reimbursement. Each service provider reported on the cost report must have been included on the RMTS Participant List in the quarter(s) for which their costs are being claimed. STAIRS has pre-populated each district's cost report with staff information from each district's certified RMTS participant lists for the October through December, and January through March, April through June time studies.

  • If there were any "vacant" positions listed on the participant list, those vacant positions will need to be edited to include the replacement staff person's information.
  • If member districts of an SSA/Cooperative incorrectly described the shared staff as employees on the participant list that information will need to be edited to reflect “contracted” staff.
  • If you have staff performing direct medical services during the “summer school session”, the position must be identified on the participant list in order to bill for services and report cost.

I29. Can a district add a position to the cost report?

The State of Texas Automated Information Reporting System (STAIRS) allows cost report preparers to edit positions that were migrated to a district’s cost report from its participant list, but does not allow prepares to add new positions.

I30. If a provider was reported multiple times on a district’s participant list in error and thus appears on the cost report multiple times, what would be the proper way to record the position’s costs? Would the costs need to be split amongst the multiple entries?

Please enter the total individual cost under one name and document in your records the issue.

I31. What paid hours should be reported?

If payroll costs are being reported for a staff person for the entire reporting period, then the paid hours would be those paid for that person for the entire reporting period. If payroll costs are only being reported for a staff person for the period of 9/1 through 3/31, then the paid hours for that staff person would be those for the period covering 9/1 through 3/31.

I32. Does a district have to report its payroll costs for direct medical services staff by entering each individual staff person?

No. Each district can choose to report such payroll costs on an individual staff basis (Step 3A) or on a staff category basis (Step 3B).

Staff category basis means PTs, LPTAs, APNs/RNs, LVNs/LPNs, delegated nursing providers, personal care services providers, counselors, physicians, audiologists, audiologist assistants, OTs, COTAs, psychologists, SLPs, and SLP Assistants.

Note: Employees and contracted staff need to be reported separately in each category.

I33. Can TRS "on behalf of" retirement payments be reported?

No. Only costs that were actually incurred by the school district can be reported.

I34. What costs can be reported for Reimbursing Employers for state unemployment?

A school district cannot report on the cost report the amounts that it sets aside each month for payment of unemployment claims. Only the amounts actually paid for claims for people listed on the cost report are allowed to be reported as costs on the cost report for a reimbursing employer. 25

I35. Can I report medical and dental fringe benefits together on the cost report?

Medical and dental fringe benefits should be reported separately on the cost report.

I36. What costs can be reported for self-insurance for worker's compensation?

If a school district has a third-party entity administering its self-insurance plan for worker's compensation, the school district can report as worker's compensation costs the portion of the administration costs applicable to the people listed on the cost report, as well as any costs associated with actual claims paid out for the people listed on the cost report. The school district cannot report as costs on the cost report the amounts contributed to the self-insurance plan, since those costs do not represent actual amounts paid out.

I37. Our workers compensation insurance costs, paid to a third party, are based on total payroll costs, why would we allocate the cost for the cost report by number of employees?

You can utilize total payroll cost allocation, but ensure that it represents true payments made for insurance. If your insurance program is a partially self-insured program, then you will need to utilize direct costing allocation.

I38. If a district has proper IEP documentation and did have costs associated to a billable service area, but does not bill for that particular service area, will the state disallow their costs? For example, a district provided speech services based on services prescribed in a student’s IEP, but was unable to bill for the services due to parental consent, would the costs associated with it will be disallowed?

It is the district’s responsibility to abide by HHSC rules and regulations and meet Texas Education Agency (TEA) standards for the delivery of SHARS. The individuals with Disabilities Education Act (IDEA) requires parental consent in order to conduct an initial evaluation to determine special education eligibility as referenced in 34 C.F.R. § 300.300(a) (1) (i). IDEA also requires that a public agency obtain parental consent before accessing the child’s or parent’s public benefits or insurance for the first time. 34 CFR §300.154(d)(2)(v). It is the district’s responsibility to maintain the documentation verifying the parental consent as the district may be selected for a desk review/audit and must verify this was conducted prior to delivering services.

If the provider delivered a service to a Medicaid client, that service must be billed through the Texas Medicaid & Healthcare Partnership (TMHP) billing system. If an audit is conducted and determined that a provider delivered services to Medicaid clients and did not bill for the services, an auditor may consider extrapolating the cost based on findings resulting in a disallowance in a portion of the cost. It is essential that if a service is delivered to a Medicaid client, that the service must be billed through the TMHP billing system. 

I39. What “other” direct medical services can be reported?

Staff travel costs to provide direct medical services, required continuing education costs, other direct medical services materials and supplies (from Appendix A), and depreciation - other direct medical services equipment. 

I40. Where can I find Appendix A?

To view Appendix A refer to the SHARS Guides/Manuals section at:

http://www.hhsc.state.tx.us/rad/acute-care/shars/index.shtml

I41. Can costs for other direct medical services materials and supplies be reported?

Yes. However, the only costs for other direct medical services materials and supplies that can be reported are those specifically approved by CMS and listed in Appendix A of the cost report instructions. 

To view Appendix A refer to the SHARS Guides/ Manuals section at:

http://www.hhsc.state.tx.us/rad/acute-care/shars/index.shtml

I42. A district has an expense for an online continuing educatuon program for special needs students functioning below grade level, what specific description on the Appendix A list does this fall within? 

Continuing education is an educational cost, not a direct medical service supply or material and therefore is not an allowable Appendix A expense. 

I43. Can costs for other direct medical services materials and supplies that are shared with the general student population be reported?

Yes. However, the only costs for other direct medical services materials and supplies that can be reported are those specifically approved by the Center for Medicare and Medicaid Services (CMS) and listed in Appendix A of the cost report instructions. Appendix A is an all inclusive list of the only allowable direct medical service supplies and materials approved by CMS. The total cost of Appendix A items reported is allowable if the materials and supplies are only dedicated to the provision of direct medical services. For example, computer software, hardware, including computers and word processors, and assistive technology software total cost is allowable only if the items are utilized for specialized services, such as for clinical evaluations and instructional software.

Data Entry Tip: Many of the cost reports steps for the cost report no longer require data to be entered sequentially. However, when entering information into the cost report system and detailed data is not available for a particular step (example: IEP or one-way trip counts), the cost report system will accept a zero entry. Zero entries will result in a "green checkmark" and the step can then be temporarily bypassed and revisited later. If you bypass a step, please remember to go back to each step to ensure all data has been corrected before submitting the cost report.

I44. If a district has not billed for a particular cost category does that mean that there can be no expenses for that category submitted on the cost report even though equipment and supplies for that cost category were purchased during the cost report period?

Any equipment, materials and/or supplies purchased for a cost category are not allowable costs if no billing was submitted for the same cost category. 27

I45. Can a district make changes to a submitted/closed SHARS Cost Report?

Yes, provider initiated amendments, corrections and/or adjustments to a closed or submitted cost report may be requested in writing up to 60 days after the original due date of the cost report. Written requests should include the district NPI, TPI, a reason for the request, and must be sent to: ra_shars@hhsc.state.tx.us

Please refer to the SHARS Cost Report Corrections document found on the webpage listed below for additional instructions.

http://www.hhsc.state.tx.us/rad/acute-care/shars/shars-2012-cost-reports.shtml

I46. Why should a district reconcile between the cost report and its billings? How detailed should the reconciliation be? Is it by category or down to the actual participants on the list?

The reconciliation, for cost report purposes, will help the district identify allowable cost categories and thus should be by category. However, districts should maintain detail information with all other SHARS related district records.

I47. Who can I contact if I have questions regarding the cost report?

For questions and assistance with the cost report you may contact the SHARS Rate Analyst(s) at: (512) 730-7400 or ra_shars@hhsc.state.tx.us.

For additional information regarding the SHARS Cost Report refer to: http://www.hhsc.state.tx.us/rad/acute-care/shars/index.shtml