Updated on: June 22, 2012

False Sense of Relief Could Spell Trouble with RACs

Original story posted on: June 3, 2009

By Cheryl E. Servais, MPH, RHIA

VP, Compliance and Privacy Officer

The medical necessity review delay is like waiting for the other shoe to drop.

While providers may feel a sense of relief in the delay of the RACs' medical necessity reviews, that feeling is a false one.

RACs can go back three years (to Oct. 1 2007), so past and current medical necessity issues still will be at risk for RAC reviews whenever they decide to implement them. The delay to 2010 does not impact the population of claims they can consider.

As Medicare Administrative Contractors (MACs) roll out, Local Coverage Determinations (LCDs) are changing daily. RACs need to get up to speed on the various new LCDs and they need to update their systems with the new code combinations.

Providers need to keep up to date on the LCD changes as well. A new CMS Web site (http://www.cms.hhs.gov/center/coverage.asp) provides National Coverage Determinations (NCDs) and links to LCDs and other coverage issues. Review this site routinely along with monitoring notices from the MACs. The new LCDs may change the "rules of the game" for coverage of services drastically. If you don't keep up, the RACs may find a lack of justification for the services rendered at the level or place in which they are provided.

There still are plenty of other issues for the RACs to tackle. In the process, they will become familiar with providers (which is not always a good thing).

Though it has been mentioned many times, it bears repeating that a good defensive strategy to reduce the risk of negative RAC findings is a three-pronged approach:

  1. Proper billing - clean claims, accurate charge master postings, etc.
  2. Proper coding - coding that follows approved guidelines and is based on clear physician documentation
  3. Proper case management - verifying that admissions, procedures and services are driven by medical necessity that is thoroughly and clearly documented in the medical record.

Those who constantly show up on the RACs' radar screens for improper billing and/or coding, as in the examples Dennis mentioned, may find themselves prime candidates for more in-depth reviews in 2010.



About the Author

Cheryl Servais has more than 25 years of experience in health information management. In her position at Precyse Solutions, Ms. Servais' responsibilities include planning, designing, implementing and maintaining corporate-wide compliance programs, policies and procedures, along with updating them to accommodate changes in federal and other regulations. In addition, she oversees training and development programs related to ethics, compliance and patient privacy; develops and chairs compliance and privacy advisory committees at the executive and board levels; and takes an active role in professional organizations.

Cheryl E. Servais, MPH, RHIA

This email address is being protected from spambots. You need JavaScript enabled to view it.