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The Threat: Medical Necessity Reviews and How You Prepare and React
For all hospitals, the threat of RAC denials for one-day and short-stay cases is real. Let's take a moment to highlight the facts of this threat:
- During the RAC Demonstration Project, approximately 40 percent of identified overpayments were related to medical necessity.
- The RAC scope of work points to continued attention on the potential to deny claims due to lack of medical necessity.
- Every RAC expert in the country is telling you it is going to happen.
- The latest target date for these complex reviews is anticipated to be January 2010.
- You may have performed chart reviews indicating that your one-day and short-stay cases are having difficulty being in compliance with medical necessity documentation requirements.
- A RAC payback for a denied admission due to lack of medical necessity probably will result in the loss of the entire admission-related payment. These are significant dollars!
Be Prepared, Be Proactive
The proactive management reaction to this threat is to say, "let's fix this process so we can get our proper reimbursement for our admitted patients." I am not suggesting that you should have more admissions, but rather that your admissions simply be justified as appropriate (per regulations, including your physician's documentation) and be reimbursed as such.
Process fixes begin with assessments of your current state. Efforts to concurrently review as many one-day admissions as possible, getting case management involved in cases 24/7, establishing a physician query system and educating/engaging/empowering your medical staff on this issue are just a few of the improvements you might want to consider.
The threat of RACs is real.... if you haven't taken proactive efforts to make sure your hospital is ready, today is the day to begin!
About the Author
Bret S. Bissey, MBA, FACHE, CHC, is a nationally recognized expert in healthcare compliance. He is the author of the Compliance Officer's Handbook, published in 2006, and has presented at more than 40 regional and national industry conferences/meetings on numerous compliance topics. He has more than 25 years of diversified healthcare management, operations and compliance experience.
Contact the Author:
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