Articles Posted in Recovery Audit Contractors (RACs)

February 22, 2010: In a report released last week, CMS revealed that Recovery Audit Contractors (RACs) referred two cases of potential fraud to the Department of Health and Human Services Office of Inspector General (OIG) during the RAC Demonstration Program between March 2005 and March 2008.

The published report states that fraud detection was not a part of the scope of work for demonstration RACs. However, RACs were to report claims that they determined to be potentially fraudulent to the CMS Project Officer. The CMS Project Officer had the responsibility to send the referrals to the Program Integrity Group at CMS to determine if the referral should be sent to the PSC and/or law enforcement.

The two cases of potential fraud referred by RACs to CMS during the demonstration project were sent by one RAC. The RAC reported the potential fraud to the CMS Project Officer. According to the RAC’s report to CMS, it did not have contact with the providers with regards to the potential fraud and completed its review of the providers.

On January 28, 2010, the Centers for Medicare and Medicaid Services (CMS) announced modified additional documentation request limits for institutional providers for the RAC program in FY 2010. The limits will be annually set by each RAC in accordance with this CMS guidance to create a per campus cap on the maximum number of medical records that may be requested within a 45-day period.

In accordance with this announcement, the RAC for Region D, HealthDataInsights (HDI), has announced that it will soon begin sending Additional Document Request (ADR) letters to hospitals in the Region. The ADR letters will be mailed to the contact names listed on HDI’s provider portal. If no contact information has been provided, the letter will be sent to the hospital’s compliance officer or the chief financial officer.

For additional information regarding the RAC program and relevant updates, please visit our RAC website at https://www.wachler.com/ or contact a Wachler & Associates attorney at (248) 544-0888.

The RAC for Region D, HealthDataInsights (HDI), recently approved “anesthesia care package” and evaluation and management services for RAC review. Specifically, HDI stated:

Under NCCI Edit rules, the anesthesia care package consists of preoperative evaluation, standard preparation and monitoring services, administration of anesthesia, and post-anesthesia recovery care. Anesthesia CPT codes 00100 to 01999 (except 01996) include Evaluation & Management (E&M) services rendered on the day before anesthesia (pre-operative day), the day of anesthesia and all post-operative days. CPT code 01996 includes E&M services rendered on the same day as the 01996 service only. Physicians can indicate that E&M services rendered during the anesthesia period are unrelated to the anesthesia procedure by submitting modifiers 24, 25, 57 and/or 59, depending on claim specific circumstances, on E&M service. Only critical care E&M services are payable during the anesthesia post-operative period. The post-operative period is defined as the day immediately following the anesthesia service and any subsequent days during the same inpatient hospital admission as for the anesthesia service.

To date, HDI is the only RAC to approve the review of anesthesia care package and E&M services, although other RACs are likely to follow. RAC Region D includes Alaska, Arizona, California, Hawaii, Iowa, Idaho, Kansas, Missouri, Montana, North Dakota, Nebraska, Nevada, Oregon, South Dakota, Utah, Washington, Wyoming, Guam, American Samoa, and Northern Marianas.