Articles Posted in Recovery Audit Contractors (RACs)

The Centers for Medicare and Medicaid Services (“CMS”) are using Comparative Billing Reports as a tool to educate providers about their individual billing practices. Comparative Billing Reports (“CBRs”) show individual providers how their billing patterns for various codes and procedures compare to the state average and the national average for providers within the same field (e.g. physical therapists and chiropractors). These comparative studies are designed to help providers review their coding and billing practices and utilization patterns, and take proactive compliance measures. CMS has stated that “the CBR is not intended to be punitive or sent as an indication of fraud. Rather it is intended to be a proactive statement that will help the provider identify potential errors in their billing practice.”

CMS awarded Safeguard Services, LLC the contract for producing the CBRs and has recommended that CBRs be sent out to certain provider types that have been identified as a vulnerability in the Medicare Program. As of now, the provider types that have been identified to receive CBRs are physical therapists, chiropractors, ambulance, hospice, podiatry, and sleep studies. A maximum of 5,000 providers will be selected to receive CBRs in each provider class.

CBR data analysis involves the same data-mining tools used by Medicare audit contractors to identify candidates for audit. If you have received a CBR or are a possible candidate to receive a CBR in the future, CMS may consider you a statistical outlier in comparison to your peers, subjecting you to an increased risk of audits. It is important to review the information provided, ensure the data reported is accurate and integrate any necessary compliance measures. CBRs are to be used as a tool for providers to look at their individual billing patterns in comparison to peers in their specialty, identify any potential errors and take proactive compliance efforts. Upon receiving a CBR, it is vital that providers evaluate the information and design a proper compliance plan to address any vulnerabilities and prepare for or defend against potential future audits. If you are a recipient of a CBR or are among the provider types that have been identified to receive CBRs (i.e. physical therapists, chiropractors, ambulance, hospice, podiatry, and sleep studies), please contact a Wachler & Associates attorney at 248-544-0888 to discuss evaluating the CBR analysis and development of an appropriate compliance plan that will reduce audit risks.

DCS Healthcare added 11 new approved issues for medical necessity reviews for providers in Region A states. The recently approved new issues may be reviewed for providers in Pennsylvania, the District of Columbia, New Jersey, Delaware, New York, Connecticut, Vermont, Maine, Massachusetts, New Hampshire, and Rhode Island, excluding Maryland. The new issues include:

• MS-DRG 885 psychoses

• MS-DRG 188 pleural effusion without CC-MCC

DCS Healthcare: The Region A RAC added three new medical necessity claims to its approved issues list. These claims are:

• Peripheral/cranial nerve and other nervous system procedures with MCC (MS-DRG 040);
• ECMO or tracheostomy with MV 96+ hrs or PDX except face, mouth and neck with major O.R. (MS-DRG 003);

CGI, the Recovery Audit Contractor (RAC) for Region B, recently removed four DRG validation issues from its list.  This means that providers in Region B will no longer be subject to RAC audits on these particular procedures.

Connolly has added several new RAC issues to its CMS approved list.  One issue, Duplicate Claims, has been added for outpatient hospital claims.  Twelve issues have been added to DRG validation claims, and twenty-four issues have been added for medical necessity claims.  Providers in Region C need to be aware and prepared for these new issues being audited.

Some examples of the new medical necessity issues include: Skin graft and/or debridement DRG 577; Endocrine, nutritional and metabolic disorders DRG 639; Acute inpatient admission, MS-DRG 491.  For a full list of the new issues in Region C, please visit Connolly’s website.

Effective February 14, 2011, CMS has limited the number of records RACs may request when reviewing Medicare claims from Physicians and other practitioners.  These requests for medical records, which are used in connection with complex claims reviews, will be limited based on the size of the group/office being audited.

If you have any questions regarding RAC, Medicare or other third party payor audits, please contact a Wachler & Associates attorney at 248-544-0888 or www.Wachler.com.

Connolly Healthcare, the region C RAC, recently posted 77 new issues eligible for review.  Twenty-three of these new issues involve Medical Necessity reviews, several of which include reviews of acute inpatient admissions to validate the medical necessity of short stay admissions.  These new approved issues implicate a variety of MS-DRGs, which will involve reviews for the medical necessity of the services and whether the MS-DRGs, which will involve reviews for the medical necessity of the services and whether the MS-DRG at issue was billed correctly.

DCS Healthcare, the RAC for region A, posted 7 new issues for review.  The new approved issues involve MS-DRG validation.  The issue description provided by DCS Healthcare indicates that the reviews require that diagnostic and procedural information and the discharge status of the beneficiary, as coded on the claim, matches the attending physician’s description and the patient’s medical record.

If you are facing a RAC audit or would like more information about a RAC related issues, please contact a Wachler & Associates attorney at (248) 544-0888 or visit www.Wachler.com.