  | |||||||||||
MediStar Meducation AlertSM | |||||||||||
RAC Program Recovers Overpayments, By Pam Nole, Director of Consulting Services, MediStar
The Tax Relief and Health Care Act of 2006 made the RAC program permanent and effective on January 1, 2010, nationwide. Prior to that, there was a three year RAC demonstration in which CMS reported that the RACs had corrected approximately $992.7 million in overpayments, all collected from providers who had been erroneously compensated. Provider outreach has now occurred in every state, and all states are eligible for review. Many physicians and practice administrators continue to have questions about RACs, but knowledge and awareness are strong tools to have in your arsenal to protect your practice integrity and reimbursements. (See related article in this issue.) The bottom line is always, "Do the right thing because it’s the right thing to do." Be aware that if you don’t, you’ll be returning money to CMS programs, along with substantial penalties.
It Pays to Be Aware of the RAC Facts |
Whistleblowing: According to government allegations, a Connecticut medical practice improperly billed the Medicare program for three services: treatments relating to back pain; physical therapy procedures that should not have been billed for the same patient at the same time; and more expensive office consultation visits, instead of less expensive new patient visits. Allegations arose from a complaint against the practice that was filed in the United States District Court under the "whistleblower" provisions of the False Claims Act. The relator (whistleblower) was a retired physician who had treated some of the practice's former patients. To settle the allegations, the practice agreed to pay $222,855, which covered conduct occurring from 2003 through 2008. Provisions of the False Claims Act entitle the whistleblower to a percentage of the proceeds of any judgment or settlement recovered by the Government. The retired physician's share was $33,428. | ||||||||||
It Pays to Be Aware of the RAC Facts
The purpose of the RAC program is to detect and correct past improper payments so that CMS can implement actions to prevent future improper payments. If you bill on a fee-for-service basis, your claims are subject to RAC reviews. RACs are paid on a contingency fee basis, and if they lose at any level of appeal, they must return their contingency fees. Claims are reviewed on a post-payment basis. RACs, Medicare Administrative Contractors (MACs), carriers, and fiscal intermediaries all use the same Medicare policies: National Coverage Determination (NCD), Local Coverage Determination (LCD), and CMS manuals. RACs cannot review claims prior to October 1, 2007. The maximum look-back period is 3 years. There are two types of audits:
There are differences between RAC and other post-payment reviews:
The RAC collection process is the same for all identified overpayments: the explanation of benefits (EOB) or denial letter uses code N432; remittance advice is issued; and overpayments are recovered by offset unless the provider submits a check or a valid appeal. Providers may also apply for an extended repayment plan. RAC will accept imaged medical records on a CD or DVD. 2010 documentation limits have not been established for professional services or for durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS), but they have been established for institutional providers as follows:
Caps have been set in terms of additional documentation requests (ADRs):
How to Be Prepared
Should You Find Yourself in a RAC Review Process
MOST IMPORTANTLY, if you disagree with the RAC determination, do not stop with sending a discussion letter! Make sure that all your appeals are timely - within 120 days after the issue of the demand letter. For more information about the overpayment determination process, visit Provider Options. New issues for Region A are posted at Diversified Collection Services (DCS). | |||||||||||
Credentialing: A Necessity for a Successful Practice By Katarina Tomin, Director of Credentials XpressSM, MediStar Medical credentialing is the process of establishing the qualifications of licensed healthcare providers by assessing their backgrounds to confirm their legitimacy. Because insurance carriers want to select and retain competent providers to deliver services to their plan members, each carrier must verify the qualifications of every provider who applies for participation in its panels. Without proper credentialing, a provider cannot participate in various insurance plans and hence cannot receive compensation from the carrier for delivering services to members of those plans. If your practice does not have providers with active participation status in multiple Managed Care Organizations (MCOs) or Preferred Provider Organizations (PPOs), then you are limiting your ability to attract patients. While credentialing tends to be a cumbersome and daunting process, it is a necessity if you depend on compensation from private and government insurers. The credentialing process includes verifying education, post-graduate training, hospital staff privileges, and professional licenses, as well as checking Drug Enforcement Administration (DEA) and Controlled Dangerous Substance (CDS) resources for background information, such as claims filed against individual providers. Sometimes an insurance carrier will visit your office to conduct a review, referencing a checklist provided by the Joint Commission on Accreditation of Health Care Organizations (JCAHCO) or the National Committee for Quality Assurance (NCQA), depending on the type of your facility. NCQA is an independent agency that has spearheaded the mission of accountability and value in healthcare since 1990. This committee also sets the standards for insurance carriers in order to ensure that they are providing quality services and products to their members. NCQA practices are the standards that most insurance companies follow when credentialing their provider panels. In addition to initially credentialing providers, insurance carriers re-credential providers every two or three years, depending on the company. It is important for you to pay close attention to all communication that comes from insurance panels in which your practice providers belong, because missing a re-credentialing deadline may require re-starting the credentialing process from the beginning. This in turn results in lost revenue for a considerable amount of time, because inactive providers will not be paid by the carrier for serving patients until the credentialing process is completed once again. While initial credentialing can take several months, re-credentialing is a relatively simple process designed to ensure uninterrupted compensation for services delivered to plan subscribers. By staying on top of your credentialing deadlines, you can avoid disrupting your revenue stream. | |||||||||||
CMS Updates Report on RAC Demo Appeals Washington Report, Capitol Associates The Centers for Medicare & Medicaid Services (CMS) has updated its 2008 report on Medicare's Recovery Audit Contractor (RAC) demonstration program to include information through March 9, 2010. According to the report, providers appealed 12.7 percent of RAC determinations from the inception of the three-year demonstration through March 9, of which 8.2 percent were overturned on appeal. There are several data differences between this update and the January 2009 report. Explanations for the data differences are as follows:
Provider Appeals of RAC-Initiated Overpayments: Cumulative through 3/9/10
As the above chart notes, nearly 65 percent of appealed claims were resolved with a decision in FAVOR of the provider.
| |||||||||||
To be removed from our distribution list, click here. | |||||||||||
|
MediStar · 12 Cambridge Drive · Trumbull, CT 06611 © 2010 Medi-Claim Services, Inc. All rights reserved. | |||||||||||
Although we continue to see CMS regulatory dates come and go - and be revised and extended - one fact is clear: Recovery Audit Contractors (RACs) are here to stay.
Being informed and prepared is the best way to avoid administrative headaches and financial penalties for your practice. Here are some basic facts that you should know about the Recovery Audit Contractor (RAC) program, along with some helpful resources.
