Medicare Audits and Appeals and RAC Audits
WACHLER & ASSOCIATES, P.C. has defended over 2000 Medicare, Medicaid, and third party payor audits. The attorneys have unparalleled experience successfully defending Medicare, Medicaid, and other third party payor audits on behalf of healthcare entities, providers and suppliers nationwide. Please visit our website dedicated to RAC and Medicare Audits!
Medicare providers and suppliers can expect increased Medicare audit activity as the Recovery Audit Contractor (“RAC”) program expands nationwide, beginning this year. To view CMS’s most recent “Expansion Schedule,” please click here.
The RAC demonstration program was mandated by Section 306 of the Medicare Prescription Drug, Improvement and Modernization Act of 2003, which directed the Department of Health and Human Services (“HHS”) to conduct a three-year demonstration program using RACs. The RAC demonstration program began in 2005 in California, Florida and New York, the three states with the highest Medicare expenditures. In 2007, the program expanded to include Massachusetts, South Carolina and Arizona. The purpose of the RAC demonstration program was to determine whether the use of RACs would be a cost-effective way to identify and correct improper Medicare payments.
The RAC demonstration program proved highly “cost effective” from the point of view of CMS. Over the course of the three-year demonstration, the RACs identified and collected more than $1.03 billion in improper payments. According to CMS, factoring in the underpayments returned to providers and suppliers, the claims overturned on appeal, and the operating costs of the demonstration program, the RAC program was successful in returning $693.6 million to the Medicare Trust Funds. CMS estimates that the RAC demonstration program cost approximately 20 cents for each dollar returned to the Medicare Trust Funds. To view the most recently updated report (which accounts for additional appeals data), please click here.
Section 302 of the Tax Relief and Health Care Act of 2006 made the RAC program permanent and required its expansion nationwide by no later than 2010. CMS has already begun to move forward with this expansion. According to its most-recently published “Expansion Schedule,” CMS planned to expand to 19 states by October 1, 2008 (including Michigan), four more states by March 1, 2009, and the remaining states by August 1, 2009 or later. Therefore, Medicare providers and suppliers nationwide can expect RAC auditing in the very near future.
When providers are notified of a RAC audit, they must endure an often-burdensome process involving dedicating resources to timely submitting records and defending claims denials. CMS has provided the RACs with a significant financial incentive to aggressively review and deny claims, meaning that Medicare providers and suppliers should begin preparation to make this process easier to undergo. Additionally, providers and suppliers should be aware that if they are dissatisfied with a RAC review determination, they have a right to appeal through the Medicare appeals process. This process includes five potential stages: (1) a redetermination to the Carrier or Fiscal Intermediary; (2) a reconsideration submitted to a Qualified Independent Contractor; (3) an appeal to an Administrative Law Judge; (4) an appeal to the Medicare Appeals Council; and finally, (5) an appeal to Federal district court. Each level of appeal carries with it certain requirements with which appealing providers much comply, as failure to follow these requirements could result in the inability to continue the appeals process.
Having worked on thousands of Medicare appeals, the attorneys at WACHLER & ASSOCIATES, P.C. are highly qualified to assist providers in the Medicare or other third party payor appeals processes. For information on our recent appeal successes, click here.
Please contact us at (248) 544-0888 if you have any questions or if you would like assistance in this area.
To view CMS’s web page regarding the RACs, please click here.
RECENT PUBLICATIONS
"Audit Impact: Expanded Liability for Overpayments," Andrew B. Wachler, Esq. and Jennifer Colaviovanni, Esq., The RAC Monitor, July 2011.
"Weathering a Medicare Audit: Overview of the Medicare Appeals Process," Andrew B. Wachler, Esq. and Jennifer Colagiovanni, Esq., MGIS Talking Points Newsletter, Vol. 2 No. 3, June 23, 2011.
"Contractor Involvement in the Medicare Appeals Process," Andrew B. Wachler, Esq. and Jennifer Colagiovanni, Esq., The RAC Monitor, June 13, 2011.
"One Year Later: The Impact of Health Care Reform on Health Care Provider Audits and Compliance Programs," Andrew B. Wachler, Esq., Jennifer Colagiovanni, Esq., and Christopher J. Laney, Esq., Michigan Bar Journal, June 2011.
"RAC Medical Necessity Denials of Inpatient Services - Fair & Equitable Reimbursement," Andrew B. Wachler, Esq., The RAC Monitor, April 21, 2001.
"The Use of Payment Suspensions in the Audit Landscape," Amy K. Fehn, Esq. and Jennifer Colagiovanni, Esq., The RAC Monitor, March 24, 2011.
"New Audit Risk for Home Health Agencies: Face to Face Certification Requirements," Amy K. Fehn, Esq. and Jennifer Colagiovanni, Esq., The RAC Monitor, March 14, 2011.
"Providers Need to Be Aware of Key Hospice Risk Areas," Andrew B. Wachler, Esq. and Jennifer Colagiovanni, Esq., The RAC Monitor, March 1, 2011.
"The Impact of Mandatory Compliance Programs for SKilled Nursing Facilities," Andrew B. Wachler, Esq., Amy K. Fehn, Esq. and Jennifer Colagiovanni, Esq., The RAC Monitor, February 17, 2011.
"Prepare for increased RAC Activity in 2011," Andrew B. Wachler, Esq. and Jennifer Colagiovanni, Esq., The RAC Monitor, December 7, 2010.
For publications on other healthcare law topics, please visit Wachler & Associates, P.C.'s Publications page.
RECENT SPEAKING ENGAGEMENTS
"Strategic Approaches to Challenging Inpatient-Outpatient Denials at the ALJ Hearing," RAC Monitor Webinar, June 28, 2011.
"RACs, ZPICs, and More - The Latest Improper Payment Initiatives for Governing Audits," MGMA Webinar regarding Recent Proper Payment Initiatives, May 12, 2011.
"Preparing for and Surviving a Third Party Payor Audit," Indiana Medical Society in Merrillville, IN, April 27, 2011.
"The New Landscape of Audits: MICs, MACs, RACs and ZPICs" co-presented with Susan Emanuel, System RAC Coordinator, Catholic Healthcare West, Phoenix, AZ; and Dawn Crump Network Director of Compliance, SSM Health Care St. Louis, Orlando, FL, HCCA's 15th Annual Compliance Institute, April 13, 2011.
"Medicaid RAC Appeals - Similarities and Differences with Medicare RAC Requirements and Processes," 5th Annual Medicare RAC Summit, Washington, D.C., March 9-11, 2011.
"Full Steam Ahead: Latest Developments in Medicare and Medicaid," co-presented with James G. Sheehan, Office of the New York State Medicaid Inspector General, American Bar Association (ABA) Emerging Issues Conference, New Orleans, LA, February 23-25, 2011.
"Medicare and Medicaid Audits: A Year in Review," American Health Lawyers Association (AHLA) Hospital and Health Systems Law Institute, Las Vegas, NV, February 11, 2011.
