Developing a Practice Strategy For RACs Defense

Developing a Practice Strategy For
RACs Defense
Toni Shirk, MBA, CCEP,
Compliance Educator
Kelly Dziedzic, CHC,
Compliance Auditor
Piedmont Healthcare, Inc
Atlanta, GA
Topics of Discussion
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Overview of RAC program
Overview of the MACs and the Combined Effects
Medical Records Requirements
Strategies – Getting Ready
1
What is the RAC?
• Medicare Recovery Audit Contractor Program
• Designed to detect and recover improper past
payments
• Designed to provide information to protect from
future improper payments
• $1 billion in overpayments identified in 3-year
demonstration project
• Roll-out to all 50 states begins in 2009
Recouping of Overpayments
• Section 306 of the Medicare Prescription Drug,
Improvement and Modernization Act of 2003
• Applies to Part A and Part B
• In the demonstration project, hospital claims
account for 95% of RAC overpayment
recoveries
• In the permanent program, all claims are
expected to be reviewed
2
RACs by Region
Region A
Diversified Collection Services (DCS)
333 North Canyons Parkway
Suite 100
Livermore, CA 94551-7661
1-866-201-0580
Website: www.dcsrac.com
Email: info@dcsrac.com
Subcontractors: PRG Schultz, iHealth Technologies
and Strategic Health Solutions
Contingency Fee: 12.45%
3
RACs by Region
Region B
CGI Technologies Solutions, Inc. (CGI)
11325 Random Hills Road
Fairfax, VA 22030-6051
1-877-316-7222
Website: http://racb.cgi.com
Email: racb@cgi.com
Subcontractor: PRG Schultz
Contingency Fee: 12.50%
RACs by Region
Region C
Connolly Consulting Associates, Inc. (Connolly)
50 Danbury Road
Wilton, CT 06897
1-866-360-2507
Website: www.connollyhealthcare.com/RAC
Email: RACinfo@connollyhealthcare.com
Subcontractor: Viant, Inc.
Contingency Fee: 9%
4
RACs by Region
Region D
HealthDataInsights, Inc. (HDI)
7501 Trinity Peak Street, Suite 120
Las Vegas, NV 89128-6896
1-866-590-5598 (Part A)
1-866-376-2319 (Part B)
Website: https://racinfo.healthdatainsights.com
Email: racinfo@emailhdi.com
Subcontractor: PRG Schultz
Contingency Fee: 9.49%
5
Types Of Reviews
AUTOMATED (Desktop):
• Claim determination at the system level
• No review of the medical record
• Coverage and coding determinations can be
made when BOTH of the following apply:
– Certainty that service is not covered or is incorrectly
coded
– Written Medicare policy, Medicare article or
Medicare-sanctioned coding guideline exists
Types of Reviews
AUTOMATED (continued)
• May also be used for:
– Duplicate Claims
– Pricing Mistakes
– Failure to provide records
• When there is certainty that an overpayment or
underpayment exists.
• Edits to be used:
– NCCI
– MUE
6
Types of Reviews
COMPLEX
• Claim determination utilizing the medical records
• Review for:
– DRG Validation
– Coding Validation
– Medical Necessity
– DME Medical Necessity
Types of Reviews
COMPLEX
• High probability (but not certainty) of noncovered service
• Will use clinical judgment of reviewer in addition
to NCDs, LCDs, etc.
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Complex Review Records
Requests
• Can pull records back to pay date of
10/1/2007
• Future look back will be a maximum of 3
years
• Mandatory to comply
– Failure to send records will result in denial
• Specific time frames for sending
records
Complex Review
Medical Record Limits
INPATIENT HOSPITAL, IRF, SNF, HOSPICE
• 10% of average monthly Medicare claims up to a
maximum of 200 records every 45 days
– Example
• Hospital has 12,000 Medicare claims paid in 2007
• Divided by 12 = average 1,000 Medicare paid
claims per month in 2007
• X10% = 100
• LIMIT = 100 medical records per 45 days
OTHER PART A (HH, Outpatient Hospital)
• 1% of average monthly Medicare services up to a
maximum of 200 every 45 days
8
Complex Review
Medical Record Limits
PHYSICIANS (Per NPI Number)
• Solo Practitioner: 10 medical records per 45 days
• Partnership of 2-5 individuals: 20 medical records per 45
days
• Group of 6-15 individuals: 30 medical records per 45
days
• Large group (16+ individuals): 50 medical records per 45
days
OTHER PART B (DME, LAB)
• 1% of average monthly Medicare services up to a
maximum of 200 records per 45 days
MACs Emerge
• MAC stands for Medicare Administrative
Contractor
• Established through the MMA of 2003
• The FIs for Part A and the Carriers for Part B
have been combined
• 15 A/B MAC Jurisdictions
– Separate DME and Home Health & Hospice
Jurisdictions
9
What Will NOT Change
RACs will not replace:
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–
–
–
OIG/OAS Audits
CERT program
MAC Audits/Reviews
NCCI/MUE Edits
The RAC program was designed to
complement the CMS audit and review
program, not replace any current audit
or edit process.
10
RACs and MACs Combined
BENEFITS FOR THE RACS
• One-Stop Comprehensive Claim Review
– MAC provides data “warehouse” for each RAC
– Fewer Locations to Find Claims
– Data Mining Made Easier
BENEFITS FOR PROVIDERS
• All Claims Paid From One Payor Location
• All (Future) Appeals Go To One Location
Managing Your Medical RecordsGetting Prepared
You should be prepared to provide:
– Documentation of all services provided and billed for
• E/M level supported by physician documentation
• Labs/Radiology services performed in the office
have reports/results included
– CMS 1500
– Documentation of services provided outside
the office which were used in medical
decision making (i.e. consults, outside labs/rad)
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Managing Your Medical RecordsKnown RAC Audit Issues
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Bronchoscopy
IV Hydration
Once in a Lifetime Procedures
Pediatric Codes Exceeding Age
Parameters
Managing Your Medical RecordsProjected RAC Audit Issues
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Place of Service Reviews
High Dollar Services
High Volume Services
Injections
Lesion Excisions
Laceration Repairs
Preoperative E/M Services
12
Developing Your Office StrategyRAC Appeal Process
• First Level of Appeal – Re-determination w/FI or
MAC
– Appeal within 120 days of receiving notice
– Appeal within 30 days to stop recoupment
• Second Level of Appeal – Reconsideration with
the QIC
– Appeal within 180 days of receiving notice
– Appeal within 60 days to stop recoupment
Developing Your Office StrategyRAC Appeal Process
• Third Level of Appeal – Administrative Law
Judge Hearing
– Appeal must be filed within 60 days of notice
– Amount in controversy is >$120
• Fourth Level of Appeal – Medicare Appeals
Council Review
– Appeal must be filed within 60 days of notice.
• Fifth Level of Appeal – Federal District Court
– Appeal must be filed within 60 days of notice
– Amount in controversy is >$1,220
13
Developing Your Office StrategyKnow the Steps
AUTOMATED
• RACs will perform review and send any
overpayment/underpayment to MAC
• You will get remit and demand letter
• You will have option to appeal or repay
• Repay from future payments, submit
check or payment arrangement
Developing Your Office StrategyKnow the Steps
COMPLEX
• RACs will request records
– If you do not send-automatic denial
• RACs will perform review and send any
overpayment/underpayment to MAC
• You will get remit and demand letter
• You will have option to appeal or repay
• Repay from future payments, submit
check or payment arrangement
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Developing Your Office StrategyTracking Your RAC Activity
AUTOMATED
You should track:
• Date of remittance adjustment (N432)
• Date of Demand Letter
• Patient information and amount of claim
• Decision to appeal (if any)
• Status of appeal/repayment
Developing Your Office StrategyTracking Your RAC Activity
COMPLEX
You should track:
• Date of records request (ADR)
• Date of Review Results Letter
• Date of remittance adjustment (N432)
• Date of Demand Letter
• Patient information and amount of claim
• Decision to appeal (if any)
• Status of appeal/repayment
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RAC
Audit
Audit # Description
123456 Untimed Codes
123456 Untimed Codes
135791 Pegfilgrastim Inj
135791 Pegfilgrastim Inj
Patient POS
Name (Code)
Daisy Duck
21
Mickey Mouse 21
Cindy Lou Who 22
Tom Grinch
22
Medical
Account Records Medicare
Number Number Number
1234567890 987654 111223333A
1122233345 546213 222334444A
9876543210 321123 444556666A
9865321245 554466 666778888A
RAC
RAC
Decision Decision
Amount to Appeal
RAC Patient
Letter Letter Initial
be
to MAC
Audit # Name
Acct #
Date Received Decision Recouped Yes/No
123456 Daisy Duck 1234567890 12/1/2009 12/6/2009 Denied
$125.00 Yes
Original
Payment
Physician Location Amount
Doe, John North Office $125.00
Doe, John North Office $125.00
Smith, JaneSouth Office $150.00
Smith, JaneSouth Office $150.00
Appeal
Letter
Due To
MAC
3/31/2010
Date
Shipped
Method Method
Shipped Shipped Tracking #
2/20/2010 FedEx 123654123
Date of
Service
6/15/2009
6/20/2009
5/25/2009
5/5/2009
Date of
Letter
10/5/2009
10/5/2009
10/7/2009
10/7/2009
Date
Received
10/9/2009
10/9/2009
10/12/2009
10/12/2009
Date
Medical
Records
Due
11/19/2009
11/19/2009
11/21/2009
11/21/2009
Date
Shipped Method
to RAC Shipped
11/10/2009 FedEx
11/10/2009 FedEx
11/16/2009 UPS
11/5/2009 UPS
Appeal
Appeal Appeal
Appeal Letter
Decision Decision
Appeal
to QIC Due To
Received Received Determination Yes/No
QIC
3/1/2010 3/5/2010 Denied
Yes
8/28/2010
Tracking
#
456123789
456123789
987654321
546213879
Date
Shipped
Method Method Tracking
Shipped Shipped
#
8/10/2010 FedEx
555444666
Developing Your Office StrategyAbout Repayments
• Underpayments over $1.00 must be sent by the RAC to
the MAC for adjustment and repayment to you
• Overpayments under $10 will not be recouped by the
RACs
• RACs may not aggregate claims to reach $10
• Recoupment process will be used after 60 days if not
appealed in the 1st 30 days
• Payment plans can be up to 36 months with CMS
approval
• Unresolved debts will be referred to the
Department of Treasury
• Interest accrues at 11%
16
Things to Consider
• Consider performing an assessment of
office records for RAC preparedness
• Consider a copy service for medical
records preparation
• Consider software for creating CDs
• Consider a tracking software
• Consider a RAC Coordinator position
• CONSIDER COSTS
QUESTIONS?
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