Natalie Warf, CHP, CPCPrivacy Administrator

HCA Regulatory Compliance Support

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166 hospitals,168 outpatient centers and 400+ physician practices in 20 states and England

More than 40 facilities had some RAC activity◦ Predominately in Florida

HDI – HealthData Insights

Facilities located in all 4 permanent program RAC regions

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1. Organization is the Key2. The “Rules” Change3. Track, Trend & Report4. Know the Process & Associated Timelines5. Understand the RAC Recoupment Process

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Senior Leader◦ CFO, CEO

Responsibilities◦ Provide strategic priority and direction for RAC

program◦ Understand the overall RAC impact to facility

Financial Staffing and productivity ROI contracts

◦ Ensure the facility is ready and responding out of the gate

◦ Designate the facility RAC liaison

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RAC “Liaison” or “Coordinator”◦ Designated by senior leadership◦ Over all types of government audits? RACs, MICs…

Responsibilities◦ Ownership and coordination of facility RAC activity◦ Tracks timeliness◦ Oversees the logging/tracking mechanism◦ Leads the RAC team◦ The RAC “go to” person

Potential candidates◦ HIM Director◦ Case Manager

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Ensure all affected areas in the loop◦ Case Management◦ HIM◦ Physician Advisor◦ Billing Office◦ Mailroom◦ RAC Liaison◦ Senior Leadership◦ Medical director◦ Staff physician◦ Outpatient entities

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Internal communication plan◦ General RAC awareness◦ Areas of responsibility◦ Escalation process

External communication plan◦ Know your contacts and develop relationships,

when applicable The RAC, CMS Project Officers, FI/MAC, QIC Region C CMS PO: Amy.Reese@CMS.HHS.GOV

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Liaison between CMS and the RAC Grant extensions to the RAC Approve RAC sample letters Receives copies of provider dissatisfaction

letters/correspondence Suppresses or excludes claims Approves all web-based applications

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Can work well for a chain or health system May reduce cost and increase accountability Potential functions for centralization–

whatever works for your system◦ All correspondence logged and processed◦ Appeals prepared, sent and tracked

Centralize by type: coding vs. medical necessity◦ Account follow-up performed

Single facility may centralize to a person or department

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Topic Demonstration RACs Permanent RACs Medical Director Not Required Required Coding Experts Optional Required Credentials provided Not Required Required External validation process Not required Required RAC must re-pay contingency if provider wins appeal

Only at first level Required at all levels

Standardized provider letters Not Required Required Maximum look-back period 3 years past date of initial

payment 3 Years (not prior to 10/1/07)

Limits on medical record requests

Optional Required

Reason for review on provider letters

Not Required Required

Time frame for RACs to pay for medical records

Not set Within 45 days of receipt

What is it?◦ RAC Contract

Requirements Where is it found?

◦ CMS Website or FedBizOpps

What’s in it for you?◦ Guides you on

whether the RAC is following the “rules”

Examples◦ Coding experts◦ External validation◦ Provider outreach◦ Look back period◦ Medical record limits◦ Standardized letters◦ Contingency fees◦ Contractor websites◦ Electronic

records/submission

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Provider Type Medical Record Limit

Part A

Inpatient Hospital, IRF, SNF, Hospice

10% average monthly Medicare claims (max 200) per 45 days, per NPI

Other Part A(Outpatient Hospital, Home Health)

1% average monthly Medicare services (max 200) per 45 days, per NPI

Part B

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 Billers(DME, Lab)

1% average monthly Medicare services per 45 days

*Expected to change in 2010 – TAX ID based instead of NPI driven

CMS Main RAC Website:◦ www.cms.hhs.gov/RAC

FedBizOpps Website:◦ www.fbo.gov◦ Use this site to view contract information◦ Federal website providing government contracting

opportunities

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Participate in advocacy groups Work with the THA/THIMA Provide data to the AHA by using RACTrac

◦ www.aha.org/aha/issues/RAC/ractrac.html Attend provider outreach sessions Contact the RAC or CMS project officer when

you have problems Complete provider satisfaction surveys

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Monitor RAC websites for new issues◦ Automated reviews

Verify appropriate billing edits in place and working Work with your billing vendor to create/enhance edits

Examples: Blood Transfusions, IV Hydration

◦ Complex reviews Ensure proper procedures in place

Case management for one day stay Documentation guidelines followed

Know your weak spots

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Use a tracking tool◦ External vendors◦ In-house created database◦ Centralized spreadsheet

Consider one person for data entry Suggested data to track (account level detail)

◦ Dates correspondence received and sent◦ Standardized denial reasons◦ Appeal activity (dates, outcomes)◦ Financials

More data tracked = better reporting

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Review data for trends◦ DRG

Most reviewed? Change rate?

◦ Discharge Status Common issues?

◦ Medical Necessity Documentation issues? Specific provider? Process improvements needed?

Appeals data◦ Consistently overturning RAC denials on appeal?◦ Calculate success rates

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Senior Management Summarize high level, appeal status, takebacks, dollars at risk

RAC Team Deadline statistics, hot review items, frequencies of reviews,

appeal statistics Medical Staff

Top reviewed DRGs, medical necessity, denial rates Appeals/Billing Staff

Accounts for follow-up (e.g., medical records, appeals) Advocacy Reporting (e.g., AHA RACTrac) Use to educate and improve

processes/outcomes

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CMS approves RAC issue The RAC uses data mining and internal

processes to identify improper payments The RAC issues a demand letter The FI/MAC/Carrier issues a remittance

advice The provider may

◦ Agree◦ Discuss the issue with the RAC◦ Submit a rebuttal or appeal

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CMS approves RAC issue The RAC issues a medical record request Provider submits records The RAC reviews and sends

◦ Review Results Letter◦ Demand Letter

The FI/MAC/Carrier issues an RA The provider may

◦ Agree◦ Discuss the issue with the RAC◦ Submit a rebuttal or appeal

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Levels Level OneRedetermination

Level Two Reconsideration

Level Three

Level Four

Civil Action

Contractor FI/MAC/Carrier Qualified Independent Contractor (QIC)

Administrative Law Judge (ALJ)

Departmental Appeals Board (DAB)

U.S. District Court

Provider Must Appeal Within:

120 days from RAC determination

180 days from FI/MAC determination

60 days from QIC determination

60 days from ALJ decision

60 days from DAB decision

Contractor Response:

60 days 60 days 90 days 90 days

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• Medical records due in 45 days• The RAC must respond to records in 60 days

Review RAC decision Don’t assume the RAC is “right” Do them timely Don’t forget the basics to avoid

dismissals◦Dismissal = required elements missing

from appeal◦Beneficiary Name, HIC #, Dates of

Service, Item/Service appealed, and name and signature of appellant

Justify – cite Interqual® or Milliman®

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Definitionso Recoupment and offset = Medicare takes the money due

for an overpayment by deducting it from another RA

o Remark code = Informational designation on a Medicare RA that provides clarification on the status of the claim

o Remark Code N432 = Adjustment based on a Recovery Audit Tells the provider the claim was adjusted due to a RAC

review

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RAC demand letter and RA with remark code N432 by FI/MAC are issued This starts the appeals and recoupment clock! Use this to reconcile RAC activity

Recoupment will begin day 41 if a valid first level appeal is not received by day 30 at FI/MAC

Provider pays interest if auto-recouped on day 41 Recoupments are held if valid appeal received by day 30

for level 1 appeal or day 60 for level 2 appeal Level 3 and higher appeals do not stop the takeback

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Review the Limitation on Recoupment final rule

Determine if the facility can meet a 30 day 1st level appeal turnaround

Billing office should be on the look-out Reconcile data Interest

◦ Continues to accrue even if held and must be repaid if appeal not favorable

◦ Refunded to provider if denial overturned◦ Rate set quarterly by Treasury Dept

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