In late February, CMS announced a temporary suspension of NEW RAC audits, effective February 21st. The Recovery Audit Contractors (RACs) currently under contract to CMS were directed to discontinue sending post-payment Additional Documentation Requests (ADRs) to providers until further notice.
The contracts with the current Recovery Audit Contractors are expiring and CMS is beginning a new contract review cycle. CMS has directed the Contractors to wind down their operations in order to clear any backlog so that in the event new contractors are selected, there will be minimal carryover.
According to CMS staff, the existing RACs are welcome to respond to the new solicitation but there is no guarantee their contracts will be renewed.
In addition to announcing the suspension of new audits, CMS also announced a number of changes to the Recovery Audit Program in response to industry feedback. CMS intends to incorporate these changes into the new RAC contracts.
CMS personnel in charge of overseeing the RAC program reiterated that the goal of these changes is a “more effective and efficient program, including improved accuracy, less provider burden, and more program transparency.”
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Concern Expressed by Industry Stakeholders |
Program Changes intended to address concerns |
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Upon notification of an appeal by a provider, the Recovery Auditor is required to stop the discussion period.
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Recovery Auditors must allow 30 days for a discussion with the provider before sending the claim to the MAC for adjustment. Providers will not have to choose between initiating a discussion and an appeal.
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Providers do not receive confirmation that their request for a discussion has been received by the RAC.
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Recovery Auditors must confirm receipt of a discussion request within three days. |
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Recovery Auditors are paid their contingency fee after recoupment of improper payments, even if the provider chooses to appeal.
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Recovery Auditors must wait until the second level of appeal is exhausted before they receive their contingency fee. |
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Additional documentation request (ADR) limits are based on the entire facility, without regard to the differences in department within the facility.
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The CMS is establishing revised ADR limits that will be diversified across different claim types (e.g., inpatient, outpatient). |
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ADR limits are the same for all providers of similar size and are not adjusted based on a provider’s compliance with Medicare rules. |
CMS will require Recovery Auditors to adjust the ADR limits in accordance with a provider’s denial rate. Providers with low denial rates will have lower ADR limits while providers with high denial rates will have higher ADR limits.
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Thank you to Bill Finerfrock, MattReiter, and Zhaneta Mansaku for writing this article.
