In Case You Are Audited: RAC Readiness Check List

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This content comes from Conomikes Associates Inc., a resource on practice management tips for community physicians, practice managers and medical office staff for more than 20 years.

Despite numerous regulations regarding proper claims submission, processing, and payment, CMS believes that improper payments continue to be made. Congress authorized the Recovery Audit Contractors (RAC) Program to help identify underpayments and overpayments and recoup overpayments under Medicare part A or B.  Since more than $1 billion in overpayments has been recovered, CMS plans to expand this program nationwide.

Improper payments
Payment errors occur for a variety of reasons including:

  • incorrectly coded services;
  • Medicare is billed as primary payer instead of secondary;
  • use of outdated fee schedules;
  • providers bill duplicate claims;
  • providers fail to submit documentation when requested or fail to submit appropriate documentation to support the claim; and
  • services that do not meet Medicare’s medical necessity criteria


If you receive a RAC letter
Here’s how to be prepared:

  • appoint one person to guide your practice;
  • review information concerning the RAC demonstration project and results to date;
  • identify all the episodes-of-care meeting Medicare Medical Necessity Criteria and make sure they are present on all claims, especially outpatient claims;
  • strengthen your physician query process by clarifying any conflicting or unclear documentation prior to claim submittal;
  • perform coding and billing education based on these actions; and
  • use the findings of your historical claims review, or external auditing review to develop a RAC response plan.


Source: M-Scribe Technologies