October 17, 2013

RAC “Discussion Period” Encouraged Given ALJ Backlog

By Susan Emanuel

The Office of Medicare Hearings and Appeals (OMHA) is responsible for Level 3 of the Medicare claims appeal process.This summer, OMHA posted a concerning notice on its website. The notice indicated that, due to an overwhelming workload, it was implementing a program that defers the assignment of most requests for administrative law judge (ALJ) hearings received after July 15, 2013. Hearing requests received after that date are entered into the office’s case processing system, but a hearing date is not issued until an opening is available on an ALJ’s docket.

The notice goes on to note that, due to the overwhelming volume of requests for ALJ hearings, there could be significant delays of up to 28 months before facilities receive notices of assignment of their scheduled hearing dates. Couple this with the latest operating status released by OMHA, indicating reduced staffing levels during the government shutdown, and the appeal backlog shows no immediate signs of relief.  

At Dignity Health, our own personal success with the Recovery Auditor (RAC) discussion period and the overwhelming backlog in the appeals process led us to revisit our use of the discussion period. We now encourage our facilities to hardwire it into their processes for appropriate cases.

Discussion period overturns have several benefits:

  • Discussion period appeals are less labor-intensive and costly, as facilities don’t have to submit medical records. Simply fax your discussion form (which can be found on each RAC’s website) and an appeal letter with any additional or highlighted supporting documentation to the RAC.
  • Discussion period overturns sometimes occur before the 30-day offset period expires, allowing providers to avoid the offset and refund process altogether.
  • Discussion period overturns represent a much quicker resolution and turnaround time than the standard Medicare Appeals process.

Data from the American Hospital Association (AHA) indicates that many other providers are taking this approach as well. The latest AHA RACTrac survey of providers across the nation showed that of the nearly 1,300 providers who responded, 45 percent reported having a denial reversed by using the discussion period. The breakout by RAC region is as follows:

  • 60 percent of Region A providers experienced a successful denial reversal during the discussion
  • 46 percent of Region B providers experienced a successful denial reversal during the discussion
  • 41 percent of Region C providers experienced a successful denial reversal during the discussion
  • 35 percent of Region D providers experienced a successful denial reversal during the discussion

The discussion period offers an opportunity to dialogue with your RAC contractor and communicate your position regarding the RAC’s decision before moving into the appeal process. It is a viable option providers may use to reverse RAC denials and avoid the formal Medicare appeal process. During the discussion period, a provider can request more information from a RAC to better understand the cause for the denial and also provide the RAC with additional information that could potentially result in the reversal of a denial.

All RACs are required to allow a discussion period option for each RAC review.  For automated reviews, sites can participate in the discussion period upon receipt of the demand letter.  For complex reviews, the discussion period begins upon receipt of a review results letter. The discussion period ends upon recoupment of the monies (i.e., day 41 after the date on the demand letter) regardless of the type of review.

 Upon receipt of a review results letter (for complex reviews) or the demand letter (for automated reviews), the RAC’s response and the medical record should be reviewed carefully. The same methodology of if and how to appeal a denied case can be used for the discussion period. Often the RAC “leaves out” very important information from their decision making process.  The discussion letter is a way to provide visibility to any RAC oversights by highlighting key components of the chart in your argument and directly putting this information in front of them for review.

Tracking and trending successes and failures involving the discussion period can help your facility better understand the review practices of your RAC. Examples of areas to track include discussion outcomes by DRG, by procedure, and by root cause. Such outcomes from the discussion period also represent a factor to consider when developing your appeal strategy. Even if your claim is not overturned, the RAC’s response to your discussion period request can be helpful when crafting a Level 1 appeal letter to the MAC.

Thus, if your facility has bypassed the discussion period, consider revisiting this strategy. In some instances, the discussion period represents an opportunity for quicker and less costly resolution of your denial than the formal and very backlogged Medicare appeals process.

About the Author

Susan Emanuel is responsible for providing RAC guidance, support, and oversight for Dignity Health, a member of the Catholic Healthcare West system. As part of her role, Susan ensures key stakeholders have the tools, knowledge, and process to effectively manage the audit response and minimize the fiscal impact to the health system while also analyzing data to measure the effectiveness of those existing processes and identify any ongoing areas of vulnerability. Susan’s background in healthcare includes operational oversight and leadership of Patient Access, HIM, and PFS departments. Most importantly, she is a proud alumna of the University of Florida.

Contact the Author

Susan.Emanuel@DignityHealth.org

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