Major Changes Coming to Medicare Cost ReportsWhat Providers Need to Know

11/3/2025 - By Chris Biedal

The Centers for Medicare & Medicaid Services has once again revamped the Medicare cost report form, this time for skilled nursing facilities filing on form CMS-2540. This represents the first major update to the SNF cost report form in over 14 years, and providers and cost report preparers will need to adapt their templates to the new revisions. The new form is effective for fiscal years ending on or after 9/30/2025.

Some of the key changes to the cost report form include:

  • Increased detail in reporting census statistics. Providers must now report Medicaid and Medicaid HMO census statistics separately. Medicare HMO is now required to be reported separately, instead of being grouped to “Other” payors.
  • Similarly, routine and ancillary revenue must now be reported by payor source, Medicare FFS, Medicare HMO, Medicaid, Medicaid HMO, and all Other.
  • Worksheets E and E-1 have been streamlined, with obsolete lines having been removed, and Worksheet E Part II has been renamed as E-2.
  • Worksheet A has the most significant change, with the addition of a new column for reporting contract labor costs separately from other non-salary costs. Routine and ancillary cost centers are reported under different line numbers.

To see all of the changes in detail, see the link below: Medicare Provider Reimbursement Manual

If you have questions about the updated Medicare cost report form or need assistance adapting your cost reporting templates and processes, Saltmarsh’s team of experienced healthcare consultants can help. Learn more about how our Healthcare Consulting team supports skilled nursing facilities on our website.

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