RAC Back on Track
The Centers for Medicare & Medicaid Services (CMS) announced Feb. 6 that the permanent Recovery Audit Contractor (RAC) program is set to begin March 1. The bidding protests filed by Viant, Inc. and PRG Schultz, USA, Inc., which caused a Stop Work order in October 2008, are resolved.
According to the new RAC Phase In Schedule, posted Feb. 10 on the CMS Web site, the RAC program will be implemented in two phases.
The RAC program will begin Aug. 1 in Vermont, New Hampshire, Maine, Massachusetts, Rhode Island, Connecticut (J14) for Part A claims (including Part B of A) and Part B claims in Rhode Island to allow for Medicare Administrative Contractor (MAC) transition. For all other Part B claims, the implementation date is March 1.
The final RACs and their jurisdictions, which match Durable Medical Equipment (DME) MAC jurisdictions, are:
Region A: Diversified Collection Services
Region B: CGI Technologies and Solutions
Region C: Connolly Consulting, Inc.
Region D: HealthDataInsights, Inc.
Viant, Inc. will subcontract for Connolly Consulting, Inc. and PRG Schultz, USA, Inc. will subcontract for Diversified Collection Services, CGI, and HealthDataInsights.
According to an August 2008 report issued by CMS, during the mandated three-year demonstration that ended March 27, 2008, RACs succeeded in correcting more than $1.03 billion of Medicare improper payments. Approximately 96 percent ($992.7 million) of those improper payments were overpayments collected from health care providers. Of that 96 percent, only 22.5 percent appealed and only 7.6 percent of those appeals were overturned. Underpayments repaid to providers totaled $37.8 million.
CMS advises hospitals and health care providers to use the RACs’ service-specific findings to help ensure they are submitting correctly coded claims for services meeting Medicare’s coding and medical necessity policies. Others advise making sure you have a well established coordination of denials and appeals, and an effective tracking tool.