1st Edition

The Medicare Recovery Audit Contractor Program A Survival Guide for Healthcare Providers

By Duane C. Abbey Copyright 2010
    124 Pages 1 B/W Illustrations
    by Productivity Press

    124 Pages
    by Productivity Press

    Medicare fraud is big business, but while only a few profit from intentional malfeasance, the Centers for Medicare & Medicaid Services is now taking a closer look at everyone. The Medicare Recovery Audit Contractor Program, already infamously known as the RAC, swings into full operation in 2010 and every healthcare provider that receives payment under any of the Medicare fee-for-service payment systems will be subject to RAC scrutiny. And scrutinize, they will… .

    Instead of developing another bureaucracy, the government has turned the job of auditing over to outside firms whose payment will be based exclusively on finder fees for recouping improper payments. There will be little tolerance for poor record keeping or gray areas of coding.

    Written by medical billing guru and Lean accounting expert, Duane Abbey, The Medicare Recovery Audit Contractor Program: A Survival Guide for Healthcare Providers explains all that is required to prepare and successfully defend against inappropriate RAC audit recoveries. Using the same succinct style that always makes his writing so accessible, Abbey illustrates his lessons with simple case studies placed in the context of a fictitious community whose population is served by a hospital, clinics, a nursing facility, and other providers all seeking to maintain compliance and profitability.

    In discussing RAC guidelines, this resource —

    • Shows how to identify overpayment areas and associated compliance issues
    • Details a systematic problem-solving process relative to RAC processes
    • Addresses resource requirements including new personnel, such as RAC specialists
    • Includes planning models for developing compliance departments
    • Provides an extensive glossary to make sense of medical billing’s alphabet soup of acronyms

    While the book works well as a stand-alone reference for those seeking advice on RAC audits, readers will also discover that this volume extends the lesson of Abbey’s classic Compliance for Coding, Billing & Reimbursement, Second Edition , making this book a natural companion for those wanting to fully explore the role of compliance and Lean accounting in medical billing.

    Acronym Listing
    Chapter 1 Introduction
    Conventions Used throughout the Book
    Chapter 2 Purpose, Structure, and Intent of the RAC Audit Program
    RAC Demonstration Project
    Selection and Utilization of RACs
    CMS and the RAC Operations
    Payment of the RACs
    Summary and Conclusion
    Chapter 3 RAC, OIG, and Medicare Audits
    General Categories of Audits
    Medicare Audits
    OIG and DOJ Audits
    Medicare CERT Program
    OIG Guidance: Federal Register
    RAC Audits
    What Happened to the Underpayments?
    CMS’s Approach for the RACs
    Summary and Conclusion
    Chapter 4 Brief Review of Healthcare Payment and Payment Systems
    Claims Adjudication Requirements
    Covered Individual/Covered Services
    Proper Orders with Appropriate Diagnostic Justification
    Qualified Facility or Practitioner
    Appropriate Documentation
    Medicare Billing Privileges
    Correct Claim, Filed Timely
    Medicare Payment Systems
    Medicare Fee Schedules
    Medicare Prospective Payment Systems
    Medicare Payment System Interfaces
    Summary and Conclusion
    Chapter 5 RAC Audit Issues
    Underlying Compliance Areas
    Medical Necessity
    Payment System Interfaces
    Inadequate Guidance
    Confusing Guidance
    Sample Problem Areas by Provider Type
    Critical Access Hospitals
    Physicians and Clinics
    Other Healthcare Providers
    Summary and Future Issues
    Chapter 6 RAC Processes
    Problem Identification, Data Mining, and Probe Audits
    Automated Reviews
    Complex Reviews
    RAT-STATS Example
    Stratified Sampling
    Using Extrapolation in Reverse
    Summary and Conclusion
    Chapter 7 Understanding the RAC Appeals Process
    Appeals Process
    RAC Discussion
    Request for Redetermination
    Administrative Law Judge
    Medicare Appeals Council
    Federal District Court
    Pursuing the Appeals Process
    Developing Organizational Resources
    Case Development
    Hierarchy of Medicare Guidance
    Clarifying Guidance
    Ambiguous Guidance
    Incorrect Guidance
    Requesting Guidance and the Federal Register
    Coding/Billing versus Adjudication/Payment
    Directives Inherent in the Payment System
    Interpretation of Guidance
    Other Issues
    MMA 2003 Protection Provisions
    Addressing Extrapolation Cases
    Summary and Conclusion
    Chapter 8 Meeting the RAC Audit Challenge
    Reviewing and Assessing Current CBR Compliance Program
    Adapting Your CBR Compliance Program
    Budgeting and Financial Impacts
    Internal RAC Program Training
    Summary and Conclusion


    Duane C. Abbey

    For many nurse leaders, understanding the mysteries of corporate compliance, the Office of the Inspector General, or the Department of Justice has been challenging to say the least. Dr. Duane Abbey has taken these topics and, specifically, the newest kid on the compliance block-the Recovery Audit Contractor (RAC) Program-and translated them into a very understandable language that nursing leaders can get their arms around, particularly in the surgical arena. … Although the subject is potentially intimidating, this book is a very engaging and understandable read for nurse leaders. As an experienced leader but one who is a novice in compliance matters, I found that the author provides this book as a tool kit to help leaders find the information necessary to proactively prepare for a RAC audit. The author does a great job of taking the technical language related to RAC audits and incorporating the use of storytelling to explain the important concepts in an understandable and engaging format. Not surprisingly, the author has more than 25 years of health care experience, with much of his time spent divided between teaching the concepts of billing and compliance and consulting with health care organizations.
    —Maureen C. Chadwick, MSN, RN, NE-BC, Director, Peri-Operative Services, Saint Vincent Health Center, in the AORN Journal, May 2011, Vol. 93, No. 5