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Are you ready for RAC? A step by step guide

As manager of the practice, has many key responsibilities for the efficient, efficient and profitable doctor practice. Add to the mix of tough economic times we are facing (unlike any other in recent history), and his work can be really overwhelming. And above all - here comes RAC!

What is RAC? What is the program Recovery Audit Contractor, and if not has an effect on their anyway, practice - just wait, but it will.

The Recovery Audit Contractor (RAC) was authorized by Congress as part of the Medicare Prescription Drug, Improvement and Modernization Act 2003 (MMA). As part of the legislation, Congress directed the Centers for Medicare and Medicaid Services (CMS) to conduct a three-year audit recovery program demonstration in a small number of states.

The RAC program goal is to detect and correct improper Medicare payments and to collect those overpayments from providers.

Since March 2006 to March 2008, the Medicare Recovery Audit (RAC) demonstration project identified more than $ 1 billion in payments Medicare improper - including some $ 900 million in overpayments to facilities and providers.

The obvious success of this demonstration program led to the RAC program was made permanent as part of the Tax Relief and Health Act of 2006. This CMS authorization to expand the program in 50 states. The national rollout is currently underway, with CCR scheduled to be dedicated to each of the 50 states by January 2010.

The question is ...

Are you ready?

According to the website of CMS, demonstration program overpayments identified more frequently in the following four situations:

Payment for services "not were medically necessary. "(40 percent);
Payment of claims that were coded incorrectly or were paid with an outdated fee schedule (35 percent);
Payment of services without adequate documentation to support the demand (8 percent), and
Payment for services that duplicate claims were submitted and paid for the same service (17 percent).

While preparing for a potential RAC request, keep all four situations of overpayment into account and put the following preparation steps instead:

Identify a point of contact RAC / leader. In most private medical 3-5, this interface is likely to be (practice director / office manager). Larger, multi-specialty practices, may designate another member of staff as the Medical Records Manager or Billing Supervisor to be the point of contact RAC. You can now ask the RAC to conduct all requests to this individual in order to ensure that all requests for RAC are handled the same way and in a timely manner.
Performing an audit internal sampling of previous requests. Pull medical history and ensure that the records contain adequate documentation to support your claim. Remember that the documentation in the medical record must be compatible with the diagnostic information included in the claim for reimbursement. Based on the fact that 40 percent of the overpayments identified in the demonstration program were due to the services provided that was considered "not medically necessary," must ensure that supporting documentation and provides evidence that the service was really necessary.
Review your existing compliance programs to make sure you are using the most current Medicare rules. Note that CCR are not allowed to select claims for review through a selection random, but are forced to use data analysis to identify and select applications for review. The best way to reduce your risk of CRC is to ensure that are up to date with current Medicare rules and regulations and has initiated a process to incorporate the rules and regulations in your workflow practice.
Consider some outside / outside help to review their practice policies and procedures. Articles of opinion not only are useful in regard to the RAC program, but can also help identify key areas that will help your practice reduce the risk and run smoothly and efficiently. [Visit our resource page www.efficiencyinpractice.com For a list of possible sources of external audit.]

In our next issue, we will discuss RAC medical record requests and how to handle them. Meanwhile, if you have specific questions or suggest an area of RAC for us to research for you, please contact us at editor@efficiencyinpractice.com .

About the Author

Sue Kay, Senior Consultant at InHealth, is the editor of Efficiency in Practice, the free eNewsletter for medical practice managers who want to save time, money and reduce risk. For more information and to access your FREE report, The 8 Things You MUST Know About CMS’ RAC Program, visit www.efficiencyinpractice.com This article can be reprinted freely online, as long as the entire article and this resource box are included.