Mills made the declaration as he was pitch hitting for Timothy B. Hill, chief financial officer and director of CMS, who was attending the White House’s Health Care Summit on the same day.


“My goal as director of provider compliance is to strive for the day where we eliminate mistaken payments so that we do not have need for RACs,” said Mills. “Ideally, we would want no errors, but until that day comes recovery auditors are one of the tools CMS uses to reduce and identify improper payments.”
Mills said CMS also will use data produced by RAC programs to identify vulnerabilities and undertake corrective actions. Corrective actions, he said, could include outreach, education, and clarification of policies, edits, system changes or policy changes.


How to Prepare

Mills said that providers could prepare themselves by doing the following:


  • Know where previous improper payments have been found, such as those detailed in the OIG, CERT and Demonstration RAC reports.
  • Know if you currently are submitting claims with improper payments.
  • Be prepared to respond to RAC medical record requests.
  • Appeal when necessary.
  • Learn from your past mistakes.

Three Keys to RAC Success

According to Mills, there are three keys to the RAC program’s success: minimizing provider burden, ensuring accuracy and maximizing transparency.


To minimize the burden imposed on providers by the RACs, Mills said the RAC “look back period” has been limited to three years, with the earliest available date being Oct. 7, 2007. The RACs will accept imaged medical records on CD/DVD, he added, also indicating that CMS requirements for these will be “coming soon.”


To maximize transparency, Mills said new issues will be posted to the Web site along with vulnerabilities. He also noted that “detailed” Review Results Letters will follow all Complex Reviews.


Ensuring accuracy on the part of the RACs will require that each RAC employs a physician medical director along with certified coders, according to Mills. Mills also said CMS’ New Issue Review Board will provide greater oversight and noted the RAC Validation Contractor will provide annual accuracy scores for each RAC.


Mills told audience members that if a RAC loses at any level of appeal, it must return the contingency fee.


Among other announcements made by Mills:


The current focus is on provider outreach as RACs do not have any data yet and to expect letters to go out in June or July.


Information on when reviews will start will be posted on the CMS Web site.


Mills acknowledged that the demonstration was not perfect and that CMS has responded to the provider community’s concerns by improving the RAC process.

There will blackouts in states for hospitals that are going through a MAC transition.
One of the improvements in the demonstration included having physicians with the RACs and physician specialists on call.


RACs will not take a hospital-by-hospital focus, but rather will target issues that apply to all hospitals.
The RAC Claim Status Web interface will be up by 2010.


CMS still is working on the current limits, which are not set in stone, and it continues to look at the issue.


Mills could not answer a question about RACs dealing with bankrupt facilities, saying it was too complex, but the issue might be addressed on the Web site.



About the Author

Linda Fotheringill, Esq, is a founding member of Washington West, LLC, and is a nationally recognized expert on Denial and Appeals Management. Ms. Fotheringill successfully assists hospitals across the country, overturning “hopeless” denials and generating millions of dollars in otherwise lost revenue.


Linda Fotheringill is the Co-Founder & Principal of Washington & West, LLC

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