At the Margins

In case you missed it: RAC contracts get renewed—but with new limits

by Christopher Kerns

CMS has said it will revamp its Recovery Audit Contractors (RAC) program in order to increase transparency between the agency and providers and to enhance its oversight of the program.

CMS has renewed RAC contractors for CGI Federal, Connolly, HealthDataInsights, and Performant Recovery, allowing them to audit claims until Dec. 31, 2015. Those auditors will all be subject to the new rules, which limit the patient status claims review period to six months, as long as the provider submits its claim within three months of the service date.

Case study: Generating an annual RAC reserve estimate aids financial planning

The rule change limiting lookback periods is a big assist to providers wishing to re-bill certain denied Part A claims under Part B. Because CMS limits re-billing to one year from the date of service, those providers who submit claims in a timely manner (within three months), will have lookbacks limited to only six months from the date of service. Previously, many providers were often hamstrung in their re-billing efforts with longer lookback periods allowed.

But while the change is an important acknowledgement from CMS that the RAC program is in need of overhaul, it is also a reminder to the industry that the program has been incredibly successful in its goal to reduce overpayments/fraud and slow the growth rate of health care costs. It's also a reminder that the federal government remains committed to continuing these efforts for the long-term.

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Confronting the new era of post-payment audits

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