Health Care Compliance Watch : New York Health Care Compliance Lawyer & Attorney : Ilana Sable : NY Physician Representation Law

While it is impossible to pinpoint the exact areas that Recovery Audit Contractors (“RACs") will target when reviewing medical bills sent to Medicare, each regional RAC is required to post its current “issues under review” and disclose to the public the specific codes and/or procedures currently being audited by automated reviews (where no medical record is involved in the review). 

For instance, the “issues under review” identified by Region A - Diversified Collection Services (which audits New York and New Jersey, among other states) are:

•         IV Hydration

•         Bronchoscopy services

•         Blood transfusions

•         Untimed Codes

•         Neulasta: J2505; injection, Pegfilgrastim, 6mg

•         Once In A Lifetime codes

•         Newborn/Pediatric codes (i.e. newborn pediatric codes Billed for patients exceeding age limits)

•         New patient visits

•         Duplicate claims - Part B only

•         Global billing of radiology or diagnostic tests in the facility setting

•         Add-on codes

If your medical practice provides services that are identified as “issues under review,” the first step in any internal review and self-audit is to have the practices medical biller(s) and performing physician(s) review: (a) the applicable local coverage determinations (“LCDs”) and (b) the “issue description” and “issue references” disclosed with the specific “issue under review.” In most cases, the practice can easily correct the “issue” being audited by using an alternate code, submitting claims that are more detailed and/or limiting the services to allowable: beneficiaries, duration, frequency or levels.

• Email This
• Print
• Comments
• Trackbacks

When implementing the Recovery Audit Contractor (“RAC”) program, Medicare incorporated a variety of limitations and requirements that RACs are required to abide by when conducting audits of Medicare providers. Most significantly, Medicare providers should be aware of the following mandates when being audited by a RAC:

1. When conducting audits, RACs are limited to looking back up to three years from the date a claim was paid, with a maximum look back date of October 1, 2007.

2. RACs are limited in the number of medical records that they can request from a provider within a forty-five day period (medical record limits depend on the type and size of the practice).

3. RACs must accept and review extension requests if providers are unable to submit documentation in a timely manner.

4. After submission of an Additional Documentation Request (ADR) letter, RACs must initiate at least one additional contact with the provider before issuing a denial for failure to submit documentation.

5. When reviewing Evaluation and Management (“E/M”) services, RACs cannot look for incorrect levels of service (reviews of E/M services are limited to, among other things, reviews for duplicate claims and/or payments, unbundling and violations of global surgery rules).

6. RACs are prohibited from reviewing claims that were previously reviewed by another Medicare contractor (i.e. Medicare Administrative Contractors (“MACs”) or that underwent a Prepayment Review.

These points are not exhaustive and demonstrate the need for providers to understand their rights and protections when going through the audit process. The RAC program was designed with ample controls and provider protections, and it can be extremely costly and time consuming (if not debilitating) when Medicare providers fail to enforce their rights and protections when being audited by a RAC.

• Email This
• Print
• Comments
• Trackbacks

While it is difficult to pinpoint the exact areas that Recovery Audit Contractors ("RACs") will look to recover improper payments, it is worthwhile to review the current CMS Approved Audit Issues and use them as guidance for internal reviews and self-auditing.

Diversified Collection Services, covering Region A (including New York and New Jersey), lists:

• Pharmacy Supply and Dispensing Fees
• Wheelchair Bundling
• Urological Bundling

as the CMS Approved Audit Issues for Region A, and providers billing the codes that accompany these audit issues between October 1, 2007 - present may undergo an automated review (where no medical record is involved in the review) for overpayments.

The CMS Approved Audit Issues for the other three regions are as follows:

Although the audit issues vary among each region, the overall focus of CMS is important to study because it explains the manner of billing that providers must avoid.  Where, in the past, billing errors may have gone unnoticed, the advent of RACs will force providers to diligently research and review their billing and coding prior to submission for payment.    

• Email This
• Print
• Comments
• Trackbacks

In an effort to identify improper Medicare payments and fight fraud, waste and abuse in the Medicare program,  The Centers for Medicare & Medicaid Services ("CMS") awarded contracts to four permanent Recovery Audit Contractors ("RAC's").  The national RAC program is the outgrowth of a successful demonstration program that used RAC's to identify Medicare overpayments and underpayments to health care providers and suppliers in California , Florida , New York , Massachusetts , South Carolina and Arizona . The demonstration resulted in over $900 million in overpayments being returned to the Medicare Trust Fund between 2005 and 2008, and nearly $38 million in underpayments returned to health care providers. 

• Overpayments can occur when health care providers submit claims that do not meet            Medicare’s coding or medical necessity policies.
• Underpayments can occur when health care providers submit claims for a simple procedure but the medical record reveals that a more complicated procedure was actually performed.

Health care providers that will be reviewed for overpayments and underpayments include: hospitals, physician practices, nursing homes, home health agencies, durable medical equipment suppliers, and any other provider or supplier that bills Medicare Parts A and B.

On October 6, 2008, CMS announced the names of the new national RACs. The new RACs are:

• Diversified Collection Services, in Region A, initially working in Maine, New Hampshire, Vermont,  Massachusetts, Rhode Island and New York. 
• CGI Technologies and Solutions, in Region B, initially working in Michigan, Indiana and Minnesota.
• Connolly Consulting Associates, in Region C, initially working in South Carolina, Florida, Colorado and New Mexico.
• HealthDataInsights, in Region D, initially working in Montana, Wyoming, North Dakota, South Dakota, Utah and Arizona.

Additional states will be added to each RAC region in 2009.

The RACs will be paid on a contingency fee basis on both the overpayments and underpayments they find. Contingency Fees are as follows:

• Region A - 12.45%
• Region B - 12.50%
• Region C -   9.00%
• Region D -   9.49%

• Email This
• Print
• Comments
• Trackbacks