Recovery Audit Contractors (RACs)

News & Analysis as of

A Favorable, New Climate for Challenging Medicare Appeals

Over the past decade, health care providers seeking to challenge Medicare claim denials have faced increasing delays in reaching what many consider the most important step in the Medicare appeals process - a hearing before an...more

GAO Report Finds Medicare Claim Review Programs Could Be Improved with Additional Prepayment Reviews and Better Data

On May 13, 2016, the U.S. Government Accountability Office (“GAO”) released a report on the review activities of the different Medicare claim review contractors that CMS uses to help reduce improper payments and protect the...more

And You Thought RAC Audits Couldn’t Get Any Worse

If there’s one thing that unites the hospital industry—even the fiercest competitors—it’s hatred of audits by recovery audit contractors, or RACs. Why? For one thing, because RACs operate on a contingency fee basis. They...more

CMS Announces Risk-Based Adjusted Additional Documentation Request Limits for Institutional Providers

On May 3, 2016, CMS announced the availability of a revised method to calculate additional documentation request (ADR) limits for Institutional Providers in the Recovery Audit Contractor (RAC) Program. Under the new method,...more

I’ll Gladly Pay You 10 Years From Today for Care Already Provided

Most providers whose claims have been determined to be improper by the Recovery Audit Contractors (RACs) under the Medicare Recovery Audit Program have discovered that the appeals backlog “is incontrovertibly grotesque.”...more

President Obama’s Proposed Fiscal Year 2017 Budget Would Establish Competitive Bidding in Medicare Advantage Plans, Reduce...

On February 9, 2016 the Obama administration released its proposed fiscal year (FY) 2017 budget. The budget, which would top $4 trillion, allocates nearly $1 trillion to CMS. This is an increase of $26 billion from the FY...more

HHS May Be Forced to Meet Statutory Deadlines for ALJ Appeals

On February 9, 2016, a three-judge panel of the U.S. Court of Appeals for the District of Columbia Circuit reversed a district court’s dismissal for lack of jurisdiction in the American Hospital Association v. Burwell case. ...more

Health Care Update - February 2016 #4

What to Expect from Congress this Work Period - The next Hill work period basically runs from February 22nd to March 23rd. As Congress returns, here’s a brief look at the pending health care issues on the radar for this...more

Proposed 2017 Budget Savings Proposals Would Impact Providers - But Recent, Significant Decision on RACs May Soon Put Funds Back...

While providers would certainly feel the pinch from the FY 2017 budget request submitted by President Barack Obama, hospitals have some new hope on receiving funds tied up in the Recovery Audit Contractor (RAC) appeals...more

Judicial Solution May Force Faster Medicare Appeals

Last week, the American Hospital Association (AHA) and several hospitals were successful in convincing the U.S. Court of Appeals for the D.C. Circuit to overturn a 2014 lower court decision, possibly paving the way for a...more

Preview of Medicare Advantage and Part D Advance Notice and Call Letter: CMS Likely to Address Risk Adjustment, Provider Network,...

The federal government will soon kick off the all-important annual sub-regulatory cycle for the Medicare Advantage (MA) and Part D programs, issuing proposed policy changes and payment rates for calendar year (CY) 2017. The...more

Senate Considering Bill to Speed Medicare Claims Appeals

In early December of last year, Orrin Hatch (Senate Finance Committee Chairman, R-UT) and Ron Wyden (D-OR) introduced the Audit and Appeals Fairness, Integrity, and Reforms in Medicare Act of 2015 (AFFIRM Act). The purpose of...more

CMS Proposes Expansion of RAC Program to Medicare Part C – All Medicare Advantage Contracts to Become Target of RADV Audits

On December 22, 2015, the Centers for Medicare & Medicaid Services (CMS) released a request for information (RFI) and a proposed statement of work (SOW) seeking industry feedback on the expansion of the recovery audit...more

Medicare Proposes to Increase RAC Use

By now, providers are very familiar with Medicare recovery audit contractors, or RACs – the private companies who have authority to review medical records at a moment’s notice. For every dollar they opine has been improperly...more

CMS Preparing to Launch RACs for Medicare Advantage

On December 22, 2015, CMS issued a Request for Information (RFI) detailing plans to expand its Recovery Audit Contractor (RAC) program to cover Medicare Advantage organizations. ...more

Whether Naughty or Nice, Recovery Audit Contractors Are Coming to Medicare Advantage

During the holiday season lull, the Centers for Medicare and Medicaid Services (CMS) issued a weighty document. The agency put out a draft statement of work to procure Recovery Audit Contractors (RACs) for the Medicare...more

Senate Finance Committee Leaders Introduce AFIRM Act to Address Medicare Appeals Backlog

On December 8, 2015, Senate Finance Committee Chairman Orrin Hatch (R-Utah) and ranking member Ron Wyden (D-Ore.) introduced the Audit & Appeals Fairness, Integrity, and Reforms in Medicare (AFIRM) Act of 2015 (S. 2368). ...more

Washington Healthcare Update

This Week: Congress tries to put together a tax extender package, which may provide an opportunity for some Affordable Care Act changes... HHS releases final rule on bundled payment for Joint Replacement Comprehensive Care...more

CMS Gives Providers Some Leverage in RAC Record Collection Requirements: Five Things to Know about ADRs

The Centers for Medicare & Medicaid Services (“CMS”) announced that it has reduced the maximum percentage of records that providers must submit to Recovery Audit Contractors (“RAC”) through the payment auditing process...more

Also In The News - Health Headlines - November 2015 #4

CMS Posts Recovery Audit Contractor Program Update, Including Reduced Documentation Request Limits – On November 6, 2015, CMS posted updates regarding the Recovery Audit Contractor (RAC) program, including a new additional...more

AGG Helps Hospice Weather the Perfect Storm of Aggressive Medicare Payment Denials and Administrative Appeal Backlog

Medicare’s implementation of post-payment review through private contractors who are overly aggressive in denying payments, combined with a severe backlog of cases in queue for hearing before an Administrative Law Judge...more

CMS Finalizes Significant Changes to the Two Midnight Rule in the 2016 OPPS Final Rule

On October 30, 2015, the Centers for Medicare & Medicaid Services (CMS) released the Calendar Year 2016 Outpatient Prospective Payment System Final Rule (2016 OPPS Final Rule). In the 2016 OPPS Final Rule, CMS finalizes...more

Annual RAC Report Shows Significant Drop in Recoveries by CMS in 2014

On October 15, 2015, CMS released its annual recovery auditing report to Congress. CMS’s Recovery Auditor (RAC) program identifies and corrects improper payments through a combination of prepayment and post-payment reviews,...more

RACs recover $2.39 billion in overpayments in FY 2014

Last week, CMS released its report to Congress regarding the results of the FY 2014 Medicare Recovery Audit Program (the “Report”). Of note, the Report notes that RACs identified and corrected more than 1 million claims for...more

Also In The News - Health Headlines - October 2015 #4

Quality Improvement Organization Releases Guidance on Short-Stay Reviews – As previously reported, in July 2015, CMS announced that Quality Improvement Organizations (QIOs) would begin conducting reviews of certain inpatient ...more

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