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Home Health & Hospice Week

Audits:

Know Your Facts: Recovery Audit Contractors

Published on Mon Jan 03, 2005

Get ready for an extra layer of medical review.

Starting this May, you'll have another pair of eyes scrutinizing your Medicare claims - and they'll have a big incentive to find fault with your payments.

New Recovery Audit Contractors in New York, Florida and California will "identify and collect Medicare claims overpayments that were not previously identified" by providers' usual Medicare contractors - intermediaries and carriers, according to a Jan. 10 Medlearn Matters article from the Centers for Medicare & Medicaid Services.

Here are some facts about the new RACs:
 

  • RACs will review all provider type claims, including those from home health agencies, hospices and durable medical equipment suppliers.
     
  • The RACs will be paid a percentage of the money they recoup from providers.
     
  • CMS will also keep a percentage of the recoupments to go to its "program and management account."
     
  • In addition to identifying and collecting overpayments, the RACs will forward any identified underpayments to providers' usual contractors for processing.
     
  • Providers will be able to appeal RAC determinations to their regular contractors.
     
  • CMS will choose contractors for both Medicare Secondary Payer and non-MSP claims.
     
  • RACs cannot be current intermediaries or carriers.
     
  • CMS chose New York, Florida and California for the pilot because they have the largest Medicare outlays.
     
  • RACs were mandated in the Medicare Modernization Act of 2003.
     
  • The pilot will start in May 2005 and run three years. 

    Editor's Note: The RAC Medlearn Matters article is at     www.cms.hhs.gov/medlearn/matters/mmarticles/2005/SE0505.pdf.

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