Archive for: RACs
CMS releases RAC audit phase-in strategy: Complex reviews to arrive as soon as August
CMS released further information June 24 on its RAC Web site letting healthcare providers know when they can expect RACs to begin auditing. The new “CMS RAC Review Phase-in Strategy,” details different types of reviews and dates CMS anticipates the reviews will begin in various areas of the country.
The new information is consistent with CMS’ previous indications that some providers may begin to undergo automated review this month.
According to the CMS, the earliest possible dates for RAC reviews in yellow and green states are:
- June 2009-Automated reviews of black and white issues
- August or September 2009-Complex reviews for DRG validation
- August or September 2009-Complex review for coding errors
- Fiscal year 2010, which begins October 1, 2009-Complex reviews for durable medical equipment (DME) medical necessity
- Calendar year 2010-Complex reviews for medical necessity
The earliest possible dates for reviews in blue states generally fall a bit later:
- August 2009-Automated reviews of black and white issues
- October or November 2009-Complex reviews for DRG validation
- October or November 2009-Complex review for coding errors
- Fiscal year 2010-Complex reviews for DME medical necessity
- Calendar year 2010-Complex reviews for medical necessity
CMS also reaffirmed that before RACs actively begin auditing in a particular state, outreach educational sessions must occur in that area.
Although the schedule calls for automated reviews as early as this month, any issue a RAC reviews must be vetted through the CMS’ “Issue Review Board.” In addition, RACs must post the approved issues to their Web sites before the reviews can begin.
“Providers should check their RAC’s Web site often for any newly approved issues for review to anticipate their vulnerability to reviews and take backs,” says Kimberly Anderwood Hoy, JD, CPC, director of Medicare and compliance for HCPro, Inc.
Even though CMS has delayed the rollout of certain types of complex reviews, providers shouldn’t ease off on their RAC preparation activities.
“Use the time wisely to continue performing your own internal vulnerability audits and ensure that all of your policies and procedures are up-to-date. Consider this a little extra time to get your facility ready for those appeals,” says Tanja Twist, MBA/HCM, director of patient financial services at Methodist Hospital of Southern California.
Editor’s note: Twist and Hoy will be speaking at the upcoming conference, “Medicare Compliance Forum: A Strategic Approach to RACs, Observation Status and the Role of Physician Advisors,” which will be held in Atlanta this October. Twist will also be featured in the July 21 HCPro audio conference, “Medicare Appeals: Practical and Compliant Procedures for Overturning Denials.”
Q&A: RACs and physician offices
Q. Our Midwestern physician practice that has more than 30 physicians. Are physician offices “vulnerable” or on the radar for RACs?
A: Yes, they are vulnerable. In addition, CMS has stated that when a RAC denies a hospital stay or service for medical necessity, the associated physician services would also be subject to denial.
Editor’s note: Tanja Twist, director of Patient Financial Services at Methodist Hospital of Southern California answered the previous question. She will also be speaking in the upcoming HCPro audio conference, “Medicare Appeals: Practical and Compliant Procedures for Overturning Denials,” as well as at the upcoming conference, “Medicare Compliance Forum: A Strategic Approach to RACs, Observation Status and the Role of Physician Advisors,” which will be held in Atlanta this October.
Essential questions every HIM director should ask about RAC record requests
When planning for RAC record requests, HIM directors should ask the following questions:
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What is our volume of claims that fall under each RAC-identified issue? Once RACs begin posting the issues they intend to audit on their Web sites, determine whether your hospital’s volume in these areas (e.g., one-day stays) is high, says Camille Cohen, MBA, MSW, CHC, compliance solutions manager at 3M Health Information Systems in Salt Lake City. Your claims might be compliant, but a RAC could still request a large number of records because of your high volume. Responding to the requests could have considerable operational ramifications, including having to track and respond to those requests, she says.
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Do we need to hire additional staff members? This is a difficult question to answer for HIM directors, primarily because record requests could arrive arbitrarily or separately throughout a 45-day period. Because of the inconsistency, assessing whether an additional staff member is needed may be difficult, says Cohen. However, directors can and should begin to track the timing of requests upon receipt. “Initially, you may see more sporadic requests because the RACs are gearing up. After that, there may be more of a pattern to it,” she says. And don’t be afraid to seek help outside the HIM department. “There may be some function that you can off-load during a high peak time,” she says. Consulting firms you have worked with in the past may be another option.
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Will we require staff members to review records before we send them to the RAC? Reviewing records before staff members send them to the RAC adds processing time, but is wise because it helps ensure that the response is complete and no documentation is missing, says Cohen. This extra step also helps identify potential inaccuracies before the RAC does.
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Who will we assign to process record requests? Identifying the individual who will receive record requests is important to ensure compliance with the 45-day response time, says Cohen. Directors should pay close attention to the initial letter because RACs will use it to communicate the specific request limit for each organization. Hospitals may identify the designated contact person by registering this information on their RAC’s Web site. Create a process and assign a backup contact person for days when the designated individual is out of the office, says Cohen. In addition, some hospitals may decide to use a post office box for all RAC-related communications. Currently, RACs will communicate with hospitals via the U.S. Postal Service only. Using a post office box can help prevent lost and misplaced letters in a busy mailroom.
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Will we monitor the total number of requests we receive every 45 days? RACs may request a maximum of 200 records every 45 days, so ensure that they don’t exceed this limit is important. “In the demonstration program, some of the RACs made mistakes,” Cohen says.
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Which format should we use when responding to record requests? CMS requires that RACs have the ability to accept paper records and scanned images on a CD or DVD. Beginning in 2010, RACs must also accept imaged records electronically, according to the advisory. Hospitals must decide which (e.g., paper, DVD, or CD) is most feasible. This decision is particularly important for hospitals with a hybrid paper and electronic record, says Cohen. Sending your record in more than one format is inadvisable because it requires that someone outside your hospital is responsible for combining information. “Either print your electronic or scanned record or scan your print copy so you can ensure everything is together before sending it to the RACs,” Cohen says.
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Will we retain a copy of records we send to the RACs? Retaining a copy of records you’ve sent to your RAC can be helpful in case the RAC doesn’t receive them and when appealing denials, says Cohen. Hospitals should ensure that they store copied information securely, regardless of whether it is a paper duplicate or a scanned image, she says.
Editor’s note: This article is excerpted from the July issue of Medical Records Briefing.
Hospital shares experience, tips for surviving RAC audits
One of the best ways to prepare for a RAC audit comes in learning from survivors. Elizabeth Lamkin, CEO of Hilton Head Regional Hospital in South Carolina, offered guidance to HFMA’s ANI conference attendees on June 15 on how to prepare for RACs.
As part of the RAC demonstration program, Hilton Head Regional, a Tenet Healthcare hospital, was audited and subsequently went through the appeals process.
During the audit, Lamkin says the hospital was very detailed in its record keeping. "We kept a copy of everything we sent. We also reviewed every chart for compliance with our physician advisor, and were confident we had medical necessity so we appealed," she says. On the 31 charts involved in the audit, Lamkin says the hospital received 22 back saying they had been denied. "They were bounty hunters. They want your scalp," she says.
In preparing for RACs, Lamkin says it is essential for hospitals to have the right physician advisor in place to monitor medical necessity cases. At Hilton Head Regional, the chief of staff works part time as a physician advisor. "If done correctly, a physician advisor will be your saving grace," says Lamkin. "If the patient does not meet medical necessity, the call goes to the physician advisor, so it means your case managers and that doctor have to get along."
The hospital also started using a call center two years ago to advise physicians on the proper bed status of patients presenting in the emergency room. The hospital also does real-time billing audits and compliance checks on the front end.
Editor’s note: This article was excerpted from the HealthLeaders Media article “From HFMA: Preparing for a RAC Audit."
Q&A: Reimbursement for RAC medical record copying costs
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What is our volume of claims that fall under each RAC-identified issue? Once RACs begin posting the issues they intend to audit on their Web sites, determine whether your hospital’s volume in these areas (e.g., one-day stays) is high, says Camille Cohen, MBA, MSW, CHC, compliance solutions manager at 3M Health Information Systems in Salt Lake City. Your claims might be compliant, but a RAC could still request a large number of records because of your high volume. Responding to the requests could have considerable operational ramifications, including having to track and respond to those requests, she says.
-
Do we need to hire additional staff members? This is a difficult question to answer for HIM directors, primarily because record requests could arrive arbitrarily or separately throughout a 45-day period. Because of the inconsistency, assessing whether an additional staff member is needed may be difficult, says Cohen. However, directors can and should begin to track the timing of requests upon receipt. “Initially, you may see more sporadic requests because the RACs are gearing up. After that, there may be more of a pattern to it,” she says. And don’t be afraid to seek help outside the HIM department. “There may be some function that you can off-load during a high peak time,” she says. Consulting firms you have worked with in the past may be another option.
-
Will we require staff members to review records before we send them to the RAC? Reviewing records before staff members send them to the RAC adds processing time, but is wise because it helps ensure that the response is complete and no documentation is missing, says Cohen. This extra step also helps identify potential inaccuracies before the RAC does.
-
Who will we assign to process record requests? Identifying the individual who will receive record requests is important to ensure compliance with the 45-day response time, says Cohen. Directors should pay close attention to the initial letter because RACs will use it to communicate the specific request limit for each organization. Hospitals may identify the designated contact person by registering this information on their RAC’s Web site. Create a process and assign a backup contact person for days when the designated individual is out of the office, says Cohen. In addition, some hospitals may decide to use a post office box for all RAC-related communications. Currently, RACs will communicate with hospitals via the U.S. Postal Service only. Using a post office box can help prevent lost and misplaced letters in a busy mailroom.
-
Will we monitor the total number of requests we receive every 45 days? RACs may request a maximum of 200 records every 45 days, so ensure that they don’t exceed this limit is important. “In the demonstration program, some of the RACs made mistakes,” Cohen says.
-
Which format should we use when responding to record requests? CMS requires that RACs have the ability to accept paper records and scanned images on a CD or DVD. Beginning in 2010, RACs must also accept imaged records electronically, according to the advisory. Hospitals must decide which (e.g., paper, DVD, or CD) is most feasible. This decision is particularly important for hospitals with a hybrid paper and electronic record, says Cohen. Sending your record in more than one format is inadvisable because it requires that someone outside your hospital is responsible for combining information. “Either print your electronic or scanned record or scan your print copy so you can ensure everything is together before sending it to the RACs,” Cohen says.
-
Will we retain a copy of records we send to the RACs? Retaining a copy of records you’ve sent to your RAC can be helpful in case the RAC doesn’t receive them and when appealing denials, says Cohen. Hospitals should ensure that they store copied information securely, regardless of whether it is a paper duplicate or a scanned image, she says.
Hospital shares experience, tips for surviving RAC audits
One of the best ways to prepare for a RAC audit comes in learning from survivors. Elizabeth Lamkin, CEO of Hilton Head Regional Hospital in South Carolina, offered guidance to HFMA’s ANI conference attendees on June 15 on how to prepare for RACs.
As part of the RAC demonstration program, Hilton Head Regional, a Tenet Healthcare hospital, was audited and subsequently went through the appeals process.
During the audit, Lamkin says the hospital was very detailed in its record keeping. "We kept a copy of everything we sent. We also reviewed every chart for compliance with our physician advisor, and were confident we had medical necessity so we appealed," she says. On the 31 charts involved in the audit, Lamkin says the hospital received 22 back saying they had been denied. "They were bounty hunters. They want your scalp," she says.
In preparing for RACs, Lamkin says it is essential for hospitals to have the right physician advisor in place to monitor medical necessity cases. At Hilton Head Regional, the chief of staff works part time as a physician advisor. "If done correctly, a physician advisor will be your saving grace," says Lamkin. "If the patient does not meet medical necessity, the call goes to the physician advisor, so it means your case managers and that doctor have to get along."
The hospital also started using a call center two years ago to advise physicians on the proper bed status of patients presenting in the emergency room. The hospital also does real-time billing audits and compliance checks on the front end.
Editor’s note: This article was excerpted from the HealthLeaders Media article “From HFMA: Preparing for a RAC Audit."
Q&A: Reimbursement for RAC medical record copying costs
Q: If you submit requested medical records to RACs via CD, are you still reimbursed copying costs (i.e., 12 cents per page)?
A: Yes. You will be reimbursed for copying costs regardless of whether you send in paper copies or images on CD or DVD.
Editor’s note: Thanks to Nancy Hirschl, BS, CCS, president of Hirschl & Associates in Laguna Niguel, CA, for answering this question.
June 8-15 Transmittals and MLN Matters articles: CMS implements NCDs for surgical never events, and more
CMS implements NCDs for surgical never events
On June 12, CMS issued updates to the Claims Processing Manual and National Coverage Determinations (NCD) Manual pertaining to its NCDs for wrong surgery on a patient, wrong site surgery, and surgery on the wrong patient.
Effective date: January 15, 2009
Implementation date: July 6, 2009, for B MACs and carriers; October 5, 2009, for A MACs, FIs, and FISS
View the transmittal to the Claims Processing Manual.
View the transmittal to the NCD Manual.
CMS issues RAC update
On June 12, CMS updated the Medicare Financial Management Manual with information pertaining to the RAC national program.
Effective date: July 13, 2009
Implementation date: July 13, 2009
CMS implements redesigned provider statistical and reimbursement system
On June 12, CMS announced that the redesigned provider statistical and reimbursement system (PS&R) system is now available. The new PS&R will be used for all cost reports ending January 31, 2009, and later. Chapter 8 of the Medicare Financial Management Manual has been updated.
Effective date: July 13, 2009
Implementation date: July 13, 2009
CMS implements new CAH requirements
On June 12, CMS implemented new critical access hospital (CAH) requirements Under 42 CFR 485.610(e) related to CAH co-location and CAH provider-based locations.
Effective date: June 12, 2009
Implementation date: June 12, 2009
CMS issues transmittal on CMS-855 enrollment applications
On June 12, CMS issued a transmittal in which it changed the time period during which certain Medicare providers and suppliers can submit Medicare enrollment applications in advance of the effective date listed thereon.
Effective date: July 13, 2009
Implementation date: July 13, 2009
CMS issues MLN Matters articles
CMS issued several MLN Matters articles related to transmittals previously outlined in Medicare Weekly Update.
- Update-Inpatient Psychiatric Facilities Prospective Payment System (IPF PPS) Rate Year 2010
- New Drug/Biological Health Care Procedure Code System (HCPCS) Codes for July 2009 Update
- New Waived Tests
Have a RAC Question? CMS Has Some Answers
While none of the newest RAC FAQ released by CMS-it published 15 in the last week-are particularly surprising, they are perhaps a sign that CMS is continuing to make every effort to share RAC information providers need to know through as many channels as possible.
It may be sharing the same information during RAC outreach sessions or during Open Door Forum calls, but now the information is also readily available to those who wish to learn about RACs in a Q&A format.
The new or updated questions include the following:
- What is the reimbursement procedure and rate for photocopy charges associated with records for RAC audits?
- How will the RACs determine which claims to review?
- Whose claims will be reviewed under the RAC program?
- Under what circumstances can a RAC, make a finding that an overpayment or underpayment exists without requesting medical records?
- Under what circumstances will a RAC request medical records in order to determine if an overpayment exists?
- How long does a provider have to submit medical records when requested by a RAC?
- Do RACs look for underpayments? What happens if they find an underpaid claim?
- How are the RACs paid for finding underpayments?
- If a provider repays or Medicare recoups an alleged overpayment identified by the RAC and the provider later wins an appeal, will CMS reimburse the provider with interest?
- Will the RAC review evaluation and management services on outpatient hospital claims?
- Will the RACs replace all current review entities?
- Will the timing for appeals by the Medicare contractors be the same for the RACs?
- How are the RACs paid for finding and recovering overpayments?
- Will the RAC appeal process mirror the regular Medicare appeal process?
- How will the RACs choose the healthcare entity that is to be reviewed for over- or underpayments? Will it be a random process?
The entire list of questions is available on the CMS Web site.
If you have a RAC question for CMS you have yet to have resolved, perhaps now is a good time to send in your question--CMS may just be in the mood to answer 15 more questions this week.
CMS updates RAC audit timeline: Complex reviews still months away
CMS anticipates Recovery Audit Contractor (RAC) automated reviews will begin in late June and July, according to Marie Casey, deputy director of the Division of Recovery Audit Operations at CMS. However, this is not set in stone, she says, noting, “there is some leeway.”
But complex reviews won’t begin until later, says Casey. CMS is aiming to begin certain types of complex reviews (e.g., coding and DRG validation) this fall. However medical necessity complex reviews won’t begin until early 2010. ”
The nature of automated reviews is simpler on the whole, she says, making them an easier choice to roll out first. “The automated reviews are less burdensome on the provider, because there’s no request for medical records,” says Casey, adding that automated reviews are also easier on the RACs themselves to manage.
The further delay of medical necessity auditing is due to the sheer complexity of the reviews. “We’re delaying because it’s more difficult. We are really trying to ensure that when there is a difference of opinion [on the medical necessity determination of the case], the RAC clearly documents their rationale,” says Casey.
Casey says the delay will also help CMS with the rollout of its “issue review team,” a group comprised of members of various agency divisions that will look at questions that come in about policy (e.g., whether the RACs are correct in interpretation of coding guidelines).
The issue review teams will be looking comprehensively at the questions, with staff with varying expertise on the review team, before approving new issues for RAC review, according to CMS Representative Kathleen Wallace, who spoke during a May 28 Region D RAC training session held in Helena, MT.
What it all means
This is good news for providers and RACs. “Not only can providers avoid medical record requests for a few months, but this will allow providers and RACs to get used to the process before moving on to complex reviews that are more complicated and concerning,” says Kimberly Anderwood Hoy, JD, CPC, director of Medicare and compliance for HCPro, Inc.
Because complex reviews are on hold until the fall, so too are medical record requests. When they do begin to arrive, they will likely be sporadic at first–at least in Region D. HealthDataInsights, Inc, President and CEO Andrea Denko confirmed during the Helena training session that requests will initially be sporadic but should eventually fall into a pattern. “This cycle of receiving record requests will be helpful to providers,” says Hoy. “People will be able to anticipate when they’ll be getting record requests and be able to plan accordingly.”
The American Hospital Association (AHA) elaborated on CMS’ decision to wait until 2010 to begin the medical necessity reviews in the May 28 issue of AHA News Now. Thirty-two percent of all demonstration program claims denials were for medical necessity, but a CMS study found a 40% error rate for medical necessity denials of inpatient rehabilitation facility claims performed by one of the RACs in the demonstration program, according to the article. “This study validated concerns about the ability of RAC auditors to accurately judge the clinical decisions made by a patient’s treating physician–sometimes three or more years after the care was provided,” according to Rochelle Archuleta, the AHA’s senior associate director for policy.
There is some truth to this, says Casey. “The medical necessity reviews are typically more difficult and include use of clinical judgment that’s not defined in policy.”
Benko indicated that HealthDataInsights is building a system to direct cases to staff members familiar with particular types of care or facilities to help mitigate the potential for errors. HealthDataInsights Corporate Medical Director Ellen Evans, MD, highlighted their clinical review staff’s wide variety of experience. For example, the RAC would direct a cardiac case to a nurse with cardiac experience for review, or a rehab case to someone with rehab experience for review.
Other RAC news
In discussions with AHA this week, CMS clarified the time providers have to use the RAC discussion period, according to a May 28 AHA RAC Program Update. Providers will “have the option to use the RAC discussion period from the date of the RAC Review Results Letter through the date of recoupment of an overpayment–41 days following the date of the demand letter–rather than only through the issuance of the demand letter,” according to the AHA.
In addition, CMS issued a sample demand letter to the RACs, which the AHA shared with the hospital community. This will be only the first sample letter in a series from CMS, says Hoy. Wallace and Denko indicated during the Region D training session that CMS will be developing multiple uniform letters addressing various situations for providers. “This should help providers understand exactly what is going on when they receive RAC-generated demand letters,” says Hoy.
Finally, AHA confirmed in the RAC Program Update that the Government Accountability Office hopes to complete an analysis in November 2009 of the RAC demonstration program and the permanent program implementation.
