Medical Review:
HHAs Off The RAC Hook - But Suppliers Not So Lucky
Published on Mon Apr 04, 2005
Three-state medical review demo excludes home health agency claims. The Recovery Audit Contractors are already hard at work scrutinizing Medicare claims data, and your audit or overpayment letter could come any day - unless you are a home health agency.
In a surprise move, the Centers for Medicare & Medicaid Services excluded HHA claims from "the initial data universe" that it gave the five new RACs to review, said Connie Leonard, CMS project officer for the demonstration, in an April 28 Open Door Forum about the new medical review contractors. The entire three-year demonstration will not include HHA claims, a CMS spokesperson confirms to Eli.
"That is the greatest news," cheers consultant Tom Boyd with Rohnert Park, CA-based Boyd & Nicholas. Boyd feared major threats to cash flow from the RACs, reminiscent of Operation Restore Trust. Beneficiary Address Determines Review Eligibility However, claims from durable medical equipment suppliers are included in the RACs' review. If the beneficiary receiving the DME resides in California, Florida or New York, the claim is eligible for RAC scrutiny, CMS explained in the forum.
That means suppliers had better get to know their RACs: PRG Schultz International Inc. in California, Health Data Insights in Florida and Connolly Consulting in New York.
RACs Diversified Collection Services and Public Consulting Group also are conducting Medi-care Secondary Payer review in California and Florida, respectively.
Warning: If suppliers mistakenly pitch record requests from their RAC, the contractor will deny the entire claim and initiate an overpayment demand letter, CMS stressed in the forum.
How it works: Right now the RACs are using their own proprietary software to target claims for review from the data CMS gave them. That includes claims from one to four years ago, and that three-year window will roll forward on a monthly basis.
When the RAC targets a claim for review, it will send you a record request letter and will conduct medical review. If a medically oriented "complex" medical review is called for, a medical professional - usually a nurse - will conduct the review, CMS' Melanie Combs said in the forum.
Note this change: If the RAC decides all or part of your claim payment was an overpayment, it will issue you an overpayment demand letter directly. Previously, CMS had said the overpayment demand would go through a provider's usual intermediary or carrier.
When you receive the overpayment demand letter, you can pay it outright or you can work with the RAC and your carrier to have the amount recouped from your current Medicare payments.
In some cases the RAC may deny the claim without conducting medical review for obvious errors, CMS explained. Some examples are a hysterectomy billed for a male patient or an incorrect fee schedule amount. Suppliers Buy [...]
