The RACS (Recovery Audit Contractors) Begin to Show Their Stuff
August 10, 2009
Do you remember the systems meltdown we were all told to expect when our computer clocks rolled over to 01/01/2000 – the Y2K issue? Anesthesia practices and other businesses listened to the doomsday warnings, invested resources in preparing their information systems for the end of the 20th century, and proceeded smoothly into the year 2000. Excellent preparations had headed off most problems. ABC and other consultants are hoping that by educating you on avoiding and surviving a “RAC attack,” the arrival of the Medicare Recovery Audit Contractors will provide as little drama as did your software when 1999 rolled over.
The RACs are private corporations that have been awarded contracts to help the Centers for Medicare and Medicaid Services (CMS) with the mission of reducing “Medicare improper payments through efficient detection and collection of overpayments, the identification of underpayments, and the implementation of actions that will prevent future improper payments.”
There are four RACs identified by letters A through D that now cover the entire country: Diversified Collection Services, CGI Technologies, Connolly Consulting Associates and HealthDataInsights, Inc. As you have heard and read before, the RACs are bounty hunters looking for overpayments that the Medicare contractors might have missed. They conduct two types of search for improper payments made to physicians: (1) automated claims data reviews on “black/white issues” (RACs can perform an automated review when there is a clear coverage policy such as a Local Coverage Determination or National Coverage Determination, the service is medically unbelievable or a provider doesn’t respond to a records request), and (2) complex reviews of coding practices and medical necessity issues, which require medical records.
According to CMS, provider outreach must occur in the state prior to the beginning of any reviews. The schedule of provider outreach meetings and conference calls is posted on the CMS website.
On August 4, 2009, Connolly Healthcare, the RAC for Area C (AL, AR, CO, FL, GA, LA, MS, NC, NM, OK, SC, TN, TX, VA, WV and the territories of Puerto Rico and U.S. Virgin Islands), posted on its website a list of all CMS-approved audit issues that it will be targeting. Only South Carolina is affected for now. The of CPT codes for which Connolly will be running automatic audits to detect claims for more than one unit of service per day, unless billed with modifier -59, are as follows:
- Blood Transfusions: CPT codes 36430, 36440, 36450, and 36455 should be billed as one (1) per session, regardless of the number of units transfused on that date of service.
- Untimed Codes: CPT Codes where the procedure is not defined by a specific timeframe (untimed codes), e.g. CPT 92506, speech-language pathology evaluation -- regardless of the number of minutes spent providing this service only one unit of service is appropriately billed on the same day.
- IV Hydration Therapy: CPT code 96360,the maximum number of units should be one (1) per patient per date of service
- Bronchoscopy Services: CPT Codes 31625, 31628 and 31629 should be billed with a maximum number of units of one (1) per patient per date of service.
- Injection, Pegfilgrastim: By definition HCPC Code J2505 represents 6 mg per unit. The code should be billed at one (1) unit per patient per date of service.
Additionally, Connolly’s website indicates that CMS has approved audits of:
- Once in a lifetime procedures: By virtue of the description of the CPT code, these codes can be performed only once per patient lifetime, e.g. cholecystectomy, and
- Pediatric codes exceeding age parameters: Newborn/Pediatric CPT codes being applied/billed for patients who exceed the age limit defined by the CPT code.
Anesthesiologists and pain physicians are not likely to provide any of the above services, but the list serves to demonstrate the type of inappropriate claim that may be identified by computer algorithms alone, and also to raise an alert regarding Medicare enforcement interest in claims for physical therapy services. It is also a reminder that including -59 wherever appropriate may be very important.
South Carolina providers who submit more than one claim per day for the first five services on the Connolly list may begin to see letters demanding repayment. As CMS approves other issues for RAC audits, automated reviews may begin at any time. The various contractors will then start issuing demand letters for which medical practices should prepare to respond. You will know that you need to open discussions with your own RAC if you receive a “review results letter,” or a request for records, or correspondence on CMS letterhead with the following text:
Dear Medicare Provider,
The Centers for Medicare & Medicaid Services (CMS) has retained [contractor name] to carry out the Recovery Audit Contracting (RAC) program in the State of ________. The RAC program is mandated by Congress aimed at identifying Medicare improper payments.
This letter is to notify you that Medicare has made an overpayment to you for the amount of $_______. A brief description of the claims associated with this overpayment can be found on the "Overpayment Report" page. Our review results letter dated xx/xx/xxxx provided the detailed reason(s) for the overpayment determination. In order to correct this overpayment, please refund $_______by xx/xx/xxxx.
If you receive a letter containing such a message, realize that you are entitled to follow the standard Medicare appeal procedures, including requests for a redetermination, a reconsideration, an administrative law judge hearing, a Medicare Appeals Council Review and final determination in federal District Court, in that order. You should realize, however, that the RAC must also offer an opportunity for the provider to discuss the improper payment determination with the RAC, outside the normal appeal process. It is very important to keep track of deadlines in the appeals process. A “RAC Tracking Spreadsheet” offered by the speaker at a recent HCPro audio conference may be helpful.
PQRI Incentive Payments
If you would like to hear from the Medicare officials responsible for administering the PQRI program directly – and to ask your questions of officials who will make sure you get the answers – sign up for the next national provider conference call on the 2009 Physician Quality Reporting Initiative (PQRI). This toll-free call will take place from 2:30 p.m. - 4:30 p.m., EDT, on Thursday, August 20, 2009. On the agenda are:
- Status of the 2007 re-run and 2008 PQRI Incentive payments and
- feedback reports;
- How to access the 2007 re-run and 2008 PQRI feedback reports; and
- Resources to assist eligible professionals.
Be sure to register for the PQRI call before the August 19 deadline.
As always, we hope that you find our information useful. I would like to take this opportunity to thank the many individuals and practices who have sent postcards to the White House and to their Senators and Congressmen urging that Medicare rates not be used as the basis for payment in any public option health plan as the Healthcare Reform express rolls on. Your representatives are holding meetings in their “home districts” this month – we encourage you to meet with them personally to keep that vital message in front of them.
With best wishes,
President and CEO