RAC effects on agency
How are RAC’s going to affect your agency?
Many agencies have experience or understanding of ADR’s and Focused Review’s; however, many are not sure what to expect with the upcoming RAC audits. Some agencies are unfortunately waiting until they are selected for a RAC audit to determine what is in store for them.
Select Data would like to provide some insight on what to expect and provide suggestions on how to manage individual RAC audits for your agency.
What is the objective of the RAC program? The Recovery Audit Contractor (RAC) is a new program established by the centers for Medicare and Medicaid Services (CMS). The goal behind the program is to protect the Medicare trust fund due to improper payments accelerating the exhaustion.
Simply stated, the RAC audit program is to detect and correct past improper payments. The RAC audit process can not review claims prior to October 1, 2007, but can review claims three years from the date the claim was paid. The RAC’s are required to employ a team of RN’s, Certified Coders, and a Physician Medical Director. There are going to be two levels of reviews: Automated (no medical record required) and Complex (medical record required).
The RAC’s are contingency based, so therefore they are motivated to seek out variances. RAC’s can audit 1% of the average monthly Medicare episodes of care with a maximum of 200 charts every 45 days per NPI. Many are not aware that this can be repeated every 45 days for as long as the program exists.
The RACs have recovered over 96% of all audited claims resulting in take-backs of 1.3 billion dollars. This is why many in the home health industry are concerned about this new focus industry.
What to look for…
Home Health agencies should anticipate, based on the OIG work plan of 2009, to see audits of outlier payments for insulin injections. Expect audits Fiscal Intermediaries’ reason for claim denials and identified high risk areas for non-compliance. Targeted areas will involve coding, homebound status, documentation of skilled services delivered, and the overall medical necessity of care administered.
In the RAC demonstration project, 35% of findings pertained to coding. Expect Home Health coding to become one of the chief areas of focus. Remember, the RAC’s will be looking at variances allowing them to view the consistency of a client’s OASIS, coding, and clinical documentation (including the plan of care).
Agencies should be cautious that the codes affixed must bewell supported by the documentation of the clinician. Too frequently, there has been a partial denial of therapy resulting in a medical review down-code. Too often, FIs have found clinical documentation incongruent with OASIS M0 items. As such, reviewers have found that the documentation does not support the focus of care, the sequence for coding, or the medical necessity of the skilled services billed.
It is not surprising that many agencies are seeking the experts to prepare for the RAC audit process. Select Data welcomes the opportunity to support your agency for this high level of scruitiny. Select Data can assist your agency in two ways.
First, is to help you indentify areas of risk and assist your team to remedy your areas of potential weakness.
Secondly, Select Data has taken the opportunity to assist your agency in managing the RAC audit process with our SmartAudit tool, aloowing you to manage all charts selected for the RAC audit. Giving you the ability to manage the status, follow up on appeals, and provide benchmark reporting.
Please feel free to contact one of our representatives on how we can assist your agency.