Neurology & Pain Management Coding Alert

Billing Medicare as the primary payer when it is, in fact, the secondary carrier is a common problem for all medical specialties. It's such a common occurrence that Medicare has stepped in to find and correct these situations.

"CMS has hired Recovery Audit Contractors (RAC)," says Scott Groudine, MD, of Albany, N.Y. "These are active in New York, Florida and California as a Medicare demonstration project. Now Congress has deemed this a success, and RACs will have a presence in all 50 states."

The Medicare Modernization Act of 2003 required the Centers for Medicare & Medicaid Services (CMS) to establish a RAC program that finds and recovers Medicare overpayments. RACs may review any provider's information at any time.

Permanent fixture: Section 302 of the Tax Relief and Health Care Act of 2006 made the RAC program permanent and required that the program expand to all 50 states by 2010. CMS has since indicated that it's planning to expand RACs nationwide by March 2008.

Less than thrilled: The American Hospital Association has led opposition to the RACs. In a letter to CMS officials in October 2007, AHA urged CMS to re-evaluate its RAC implementation plan and "pursue a more reasonable approach" because CMS had yet to perform a complete evaluation of the demonstration program or an overall assessment of the three RAC firms.

Here's What to Expect

One of the auditors- responsibilities is to verify if a patient's primary insurer and Medicare have both been billed for a single claim or if Medicare paid when the patient's primary insurer should have paid instead. In both situations, the RAC will verify the billing errors, including any potential underpayments, and begin recovery of any controversial overpayments.

Prepare now: Be diligent in gathering your patients- insurance information and determining the primary payer. Establishing good coding and billing procedures will help protect your practice during RAC review or any other audit.