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Rac Audits What You Need To Know
- 1. Recovery Audit Contractors (RACs) Medicare, Medicaid and Commercial Insurance Investigations. What you Need to Know Brought to you by:
- 3. Mission of the government Contractors?
- 4. What does the RAC do?
- 5. How does the RAC affect providers?
- 6. How do Providers Prepare?
- 7. When the RAC arrives
- 12. Overpayments (& Underpayments) made to the providers based on the findings.
- 13. Clear documentation to support the medical necessity of the services being provided or dispensed.Medicare (CMS) was authorized by Congress with the following legislation: • Medicare Modernization Act, Section 306: Required the three year RAC demonstration & • Tax Relief and Healthcare Act of 2006, Section 302: Requires a permanent and nationwide RAC program by no later than 2010. Both Statutes gave CMS the authority to pay the RACs on a contingency fee basis. The RAC demonstration identified $1.3 billion in overpayments in 3 states in ONE year (California, New York and Florida Hospitals only)
- 15. The RAC Program Mission • The RACs detect and correct past improper payments so that CMS and Carriers, FIs, and MACs can implement actions that will prevent future improper payments: • Providers can avoid submitting claims that do not comply with Medicare rules. • CMS can lower its error rate. • Taxpayers and future Medicare beneficiaries are protected.
- 17. RACs use the same Medicare policies as Carriers, FIs and MACs: NCDs, LCDs and CMS Manuals.
- 18. RACs are required to employ a staff consisting of nurses, therapists, certified coders, and a physician CMD.
- 20. RACs will not be able to review claims paid prior to October 1, 2007.RACs will be able to review medical records three years from the date the claim was paid.
- 22. If so, when? The expansion schedule can be viewed at :www.cms.hhs.gov/rac
- 23. Regions and timelines A B D C Provider Outreach Earliest Correspondence Claims Available for Analysis March 1, 2009 March 1, 2009 March 1, 2009 March 1, 2009 March 1, 2009 March 1, 2009 August 1, 2009 August 1, 2009 August 1, 2009 *RACs are required to perform outreach programs for all providers in their region From CMS
- 24. CMS RAC Review Phase–in Strategyas of 6/24/09 Earliest Possible Dates for reviews in Yellow/Green states: Automated Review- Black & White Issues- ( June 2009 ) DRG Validation- complex review ( Aug/Sept 2009) Complex Review for Coding Errors- ( Aug/Sept 2009) DME Medical Necessity Reviews- complex review (Fiscal year 2010) Medical Necessity Reviews- complex review (calendar year 2010) Earliest Possible Dates for reviews in Blue states: Automated Review- Black & White Issues- ( Aug 2009 ) DRG Validation- complex review ( Oct/Nov 2009) Complex Review for Coding Errors- ( Oct/Nov2009) DME Medical Necessity Reviews- complex review (Fiscal year 2010) Medical Necessity Reviews- complex review (calendar year 2010)
- 26. Partnerships: (2-5 individuals): 20 medical records per 45 daysper NPI.
- 27. Groups (6-15 individuals): 30 medical records per 45 days per NPI.
- 29. Assist the providers with training programs that can ensure they are meeting documentation compliance
- 31. Identify any corrective actions required for compliance.
- 34. Evaluation & Management (office visit)
- 35. Diagnosis
- 36. Injections
- 37. Supplies
- 38. Medical Necessity must clearly state the need for all services provided or prescribed. The documentation of each patient encounter should include:
- 39. Reason for the encounter and relevant history, physical examination findings and prior diagnostic test results;
- 40. Assessment, Clinical Impression or Diagnosis;
- 41. Plan for care; and
- 43. Identify all the issues
- 45. Deploy any corrective actions to avoid improper paymentsWe Can Be Your Solution
- 47. Retain a certified coder to review the records prior to submission.
- 48. Send copies of the charts to the RAC- signature required notification of receipt.
- 51. Diversified Collection Services
- 52. www.dcsrac.com
- 53. info@dcsrac.com
- 54. 1-866-201-0580
- 55. Region C:
- 59. 1-866-360-2507
- 60. Region B:
- 61. CGI
- 63. racb@cgi.com
- 64. 1-877-316-7222
- 65. Region D:
- 71. Data center does their research & processing & makes their adjustments on overpaid claims .
- 72. Data center then creates an accounts receivable for the adjusted claim & sends it back to the RAC
- 73. Upon receiving, RAC sends written notification to the provider of the overpayment , known as the “Demand Letter”, and researches any additional files that the data center notated other errors on.
- 76. RAC sends an electronic file to the FI/MAC or associated data center.
- 77. FI/MAC or associated data center:
- 78. Does their research & processing & makes their adjustments on overpaid claims .
- 79. Send files back to RAC.
- 82. Remark Code N432: “Adjustment Based on Recovery Audit”
- 83. Recoups by offset unless provider has submitted a check or a valid appeal.
- 84. Interest will accrue from the date of the final determination.
- 85. Recoupment/payments are applied first to interest then to principle.THEY TAKE THE $$$$ DIRECTLY FROM YOUR MEDICARE CHECK 23
- 87. Send check on or before Day 30 - do not appeal.
- 88. Recoupment by Medicare (overpayment + interest) on Day 41 and do not appeal.
- 90. Request or apply for extended payment plan (overpayment + interest) and do not appeal .24
- 92. The appeal process for RAC denials is the same as for Carrier/FI/MAC denials
- 93. Do not confuse the “RAC Discussion Period” with the Appeals Process.
- 94. Don’t stop with sending a discussion letter.
- 95. Pay by check on or before day 30 (interest is not assessed) AND file an appeal before the 120th day after the Demand Letter.
- 96. Allow recoupment (overpayment + interest) on Day 41 and file an appeal by Day 120
- 97. Request or apply for extended payment plan (overpayment + interest) and appeal by Day 120
- 98. Stop the recoupment by filing an appeal before day 31.25
- 99. What to Expect Next Repeat the exact same process every 45 days until they find no more overpayments
- 101. Determine where your practice will stand with the RAC team.
- 103. They are hiring firms like Healthnet Federal Services to mimic the identical issues as the federal government.
- 104. United Health, Aetna and other commercial payers
- 105. Because they have implied authority to review all providers claimsWhat they are saying... “If the providers are miscoding for Medicare they are miscoding our claims also.”
- 107. Determine where the practice will stand.
- 108. Understand that you may need to call for help to manage the process.
- 109. Medicare is likely NOT the only payer going to take a peek.Brought to you by:
Notas do Editor
- This chart was taken directly from page 37 of the RAC EVALUATION REPORT of June 2008.Of the total $1.03 billion in improper payments corrected by the Claim RACs from the inception of the demonstration through March 27, 2008, approximately 4 percent occurred in FY 2006, 34 percent in FY 2007, and 62 percent in the first half of FY 2008.
- CMS can use this information to implement more provider education and outreach activities or establishing new system edits, with the goal of preventing future improper payments. Hospitals and other health care providers can use the information to help ensure that they are submitting correctly coded claims for services that meet Medicare’s coding and medical necessity policies.*
- The RAC program will begin with claims paid on or after October 1, 2007. This begin date will be for all states. The actual start date for a RAC in a state will not change this date. As time passes, the RAC may look back 3 years but the claim paid date may never be earlier than October 1, 2007. In other words the RAC will only look at FY 2008 claims and forward. The RAC will not review claims prior to FY 2008 claim paid dates. Any overpayment or underpayment inadvertently identified by the RAC after this timeframe shall be set aside. The RAC shall take no further action on these claims except to indicate the appropriate status code on the RAC Data Warehouse. The look back period is counted starting from the date of the initial determination (claim paid date) and ending with the date the RAC issues the medical record request letter (for complex reviews) or the date of the overpayment notification letter (for automated reviews).
- Claim RACs use a review process similar to that of Medicare claims processing contractors. Automated reviews occur when the RACs have identified improper payments because the provider clearly billed in violation of Medicare policy. For complex reviews, the RACs have identified a likely improper payment and request the medicalrecords from the provider to conduct a more in-depth review.*
- The existing withhold procedures can be found in the Medicare Financial Management Manual, Chapter 4, section 40.1.
- Although you may stop the recoupment, the aging doesn’t stop and interest continues to accrue. If you paid the overcharge in full before day 30, and you appeal before day 31, no more interest will accrue because you will have stopped the aging process. If you win on appeal, you will be reimbursed. Interest begins accruing from the date the demand letter is sent out.
- Thank You!