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CMS Releases RAC Vulnerabilities

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  • In Audit
  • July 15, 2010
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The Centers for Medicare & Medicaid Services (CMS) released July 12 a special edition MLN Matters article (SE1024), “Recovery Audit Contractor (RAC) Demonstration High-Risk Vulnerabilities – No Documentation or Insufficient Documentation Submitted.” The article is the first of a series providing information on RAC high-dollar improper payment vulnerabilities.
According to the article, “While the demonstration proved recovery auditing was successful identifying and correcting improper payments in Medicare, it also provided best practices for developing a national program and allowed CMS to identify high risk vulnerabilities.”
CMS said that two high-risk vulnerabilities identified during the RAC demonstration were:

  • Provider non-compliance with timely submission of requested medical documentation; and
  • Insufficient documentation that did not justify that the services billed were covered, medically necessary, or correctly coded.

Providers affected are all inpatient hospital and skilled nursing facility (SNF) providers that submit fee-for-service claims to Medicare fiscal intermediaries (FIs) or Part A/B Medicare administrative contractors (MACs).
To help these providers ensure timely submission of sufficient documentation to justify the services billed, RACs must:

  • clearly indicate deadlines for submission of medical records in ADR letters;
  • initiate one additional contact with the provider before issuing a denial for a failure to submit documentation;
  • accept and review extensions requests if providers are unable to submit documentation timely;
  • clearly indicate in ADR letters suggested documentation that will assist them in adjudicating the claim;
  • allow providers to submit medical records on CD/DVD or to fax the needed medical records;
  • implement the RAC look back date of 3 years with a maximum look back date of October 1, 2007;
  • limit the number of medical records requests every 45 days;
  • indicate the status of a provider’s additional documentation requests on their claim status websites;
  • establish a provider web-portal so providers can customize their address and identify an appropriate point of contact to receive ADR letters; and
  • post all approved issues under review on their websites.

View special edition MLN Matters SE1024 to help you identify provider vulnerabilities in RAC demonstration and take necessary steps to meet Medicare’s documentation requirements and eliminate unnecessary claim denial.

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