Medicare cost report: how to read a hospital's cost report for sales and account research

Most guides to the Medicare cost report are written for the people who prepare it. This one is for the people who read it from the outside: sales and research teams that want to know how big a hospital is, who pays it, how it is doing financially and what it spends on contract labor and IT.

Every line reference below comes from the CMS Provider Reimbursement Manual, the HCRIS documentation or the CMS cost report data dictionary.

What a Medicare cost report is, and why every hospital's report is public

Medicare-certified institutional providers file an annual cost report with their Medicare Administrative Contractor (MAC), and CMS keeps the data in its Healthcare Cost Report Information System (HCRIS).¹ Hospitals use Form CMS-2552-10 for periods beginning on or after May 1, 2010.²

The report covers facility characteristics, utilization, costs and charges by department, Medicare settlement data and financial statements.¹ It is a heavy lift for the hospital: CMS estimates 685 hours on average to complete one.²

Filing is mandatory, and the report is public. The Provider Reimbursement Manual says cost reports are public record under the Freedom of Information Act.²

Where to download Medicare cost reports: HCRIS files and the CMS cost report CSV

There are two ways in, depending on how comfortable you are with data.

1. The Hospital Provider Cost Report file on data.cms.gov. One row per hospital report with a subset of the most-used fields, already flattened into a CSV.³ Our count of the 2023 file found 6,109 rows, one per report, and 117 columns. Start here.
2. The full HCRIS files on cms.gov. One zip per fiscal year, from 2010 to 2026, each with a Report file, a Numeric file and an Alphanumeric file.¹ The numeric files are too large for Excel: one fiscal year holds about 19 million numeric records.⁴ You need a database or statistics software.

How HCRIS cost report data is organized by worksheet, line and column

Every number in HCRIS is addressed by three codes: the worksheet, the line and the column. The HCRIS documentation's own example is the bed count on Worksheet S-3, Part I, line 14, column 2, stored as worksheet code S300001, line 01400 and column 00200.⁵

Lines and columns are five digits, and many lines are subscripted, so a hospital can add lines between the standard ones. Always match on the full code, not on the position in a printed form.

Which Medicare cost report worksheets matter for hospital sales research

The form has dozens of worksheets. These are the ones that answer a seller's questions.²⁶

How to find beds, patient days and discharges on Worksheet S-3

Worksheet S-3, Part I is the hospital's statistics page. Line 14 is the hospital total, and its columns hold the numbers most sellers want first.⁶

• Column 2: beds. Beds available at the end of the period.
• Column 3: bed days available. Beds times days in the period.
• Columns 5 to 8: inpatient days for Title V, Medicare, Medicaid and all patients.
• Columns 9 to 11: FTEs for interns and residents, employees on payroll and nonpaid workers.
• Columns 12 to 15: discharges by program and in total.

How to calculate hospital payer mix from the Medicare cost report

Payer mix tells you how much of a hospital's inpatient care Medicare and Medicaid pay for, which shapes its margins and priorities. You can estimate it from inpatient days on Worksheet S-3, Part I.

• Medicare share of days = line 14, column 6 divided by line 14, column 8.
• Medicaid share of days = line 14, column 7 divided by line 14, column 8.

One trap: line 14, column 6 counts traditional Medicare only. Medicare Advantage days are reported separately on line 2, column 6, and kept out of the payer columns on the other lines.⁶ Add them if you want every Medicare beneficiary.

How to find hospital revenue, operating expenses and net income on Worksheets G-2 and G-3

Worksheets G-2 and G-3 are the hospital's income statement.⁶

• G-2, Part I, line 28: total patient revenues, split into inpatient (column 1), outpatient (column 2) and total (column 3).
• G-2, Part II, line 43: total operating expenses.
• G-3, line 3: net patient revenues, after contractual allowances and discounts on line 2.
• G-3, line 5: net income from service to patients.
• G-3, line 29: net income, including other income.

A quick operating margin is G-3 line 5 divided by G-3 line 3. A hospital with a negative margin will ask harder questions about your return on investment.

How to find charity care, bad debt and uncompensated care on Worksheet S-10

Worksheet S-10 shows how much care a hospital provides without full payment.⁶

• Line 1: cost-to-charge ratio.
• Line 2: net revenue from Medicaid.
• Line 20: charity care charges.
• Line 23: cost of charity care.
• Line 26: bad debt.
• Line 30: cost of uncompensated care.
• Line 31: total unreimbursed and uncompensated care cost.

High uncompensated care usually means a safety-net hospital with thin margins, where savings and staff time carry more weight than new features.

How to find a hospital's contract labor spending in the cost report

For staffing firms, this is the most useful number in the report. Worksheet S-3, Part II, line 11 reports contract labor for direct patient care, such as nursing, diagnostic, therapeutic and rehab services, and line 12 reports contracted management and administrative services. Part II is completed by hospitals paid under the inpatient prospective payment system.⁶

Worksheet S-3, Part V reports contract labor and benefit cost by component, and all hospitals complete it, including critical access, psychiatric, rehab, long-term care and children's hospitals.⁶ Line 1 is the total facility and line 2 is the hospital.

A rising contract labor line is a direct signal that a hospital is short-staffed. Pair it with how hospitals buy staffing through MSPs and VMS platforms.

How Worksheet S-2 shows type of control, components and the chain home office

Worksheet S-2, Part I identifies the hospital.⁶

• Lines 3 to 18 list each component, such as the hospital, subproviders, a skilled nursing facility, home health agency, rural health clinic or FQHC, with its name and CCN.
• Line 21 records the type of control in 13 codes, grouped into nonprofit, proprietary and governmental.
• Lines 140 to 143 name the chain home office, if the hospital claims home office costs.

That makes S-2 the bridge to the hospital's parent. See how to find out who owns a hospital for the full lookup.

When Medicare cost reports are due, and how current HCRIS data is

Cost reports are due by the last day of the fifth month after the cost reporting period ends, or 150 days after a period that ends mid-month.⁷ Because each hospital picks its own fiscal year, reports arrive all year round.

That makes the data lag. In the HCRIS files dated October 2, 2026, there were 6,113 hospital reports for fiscal 2024, of which 3,593 were still as-submitted, and 3,805 for fiscal 2025 so far.⁴

Status matters too. The HCRIS files keep only the highest status of each report: a settled report replaces the as-submitted one, and a reopened report replaces the settled one.⁸

Mistakes to avoid when using Medicare cost report data

The data is free and rich, and easy to misread.

• Treating available beds as staffed beds. They measure different things.
• Missing Medicare Advantage days. They sit on line 2, not in line 14, column 6.
• Matching on position, not code. Subscripted lines move rows around; match on worksheet, line and column codes.
• Counting a hospital twice. A hospital can file two reports in one year after a fiscal year change or a change of ownership.⁵
• Reading the hospital as the system. Each report covers one hospital and its components, not the health system above it.
• Trusting type of control blindly. CMS does not define the categories, so hospitals pick their own.⁹

If you would rather not join HCRIS files yourself, Dmand AI site of care profiles show beds, staffing and financials next to the site's place in its health system's org tree and the executives who run it, so you can qualify an account and find the buyer in one view.