Revenue Cycle

CMS releases new RAC FAQ

Recovery Auditor Report, May 14, 2009

CMS released a new RAC FAQ April 29 with important news that may have previously flown under the radar of many healthcare providers. Medical record requests necessary for complex reviews by RACs are based on 2008 calendar year claim volume—not 2007 numbers.
The new FAQ reads as follows:
Q: I heard that Recovery Audit Contractor (RAC) medical record request limits will be based on my 2007 claims volume, then I heard on 2008. Which is it?
A: We apologize for the confusion. Limits in the remainder of the fiscal year ending September 30, 2009, are based on claim volume in the 2008 calendar year. This differs from our original announcement that limits in the current year would be based on 2007 claim volumes.
Our original plan was to use the previous calendar year's volume to calculate the following fiscal year's limits. In other words, we envisioned using claims paid from January 2007 through December 2007 to develop limits for October 2008 through September 2009. Claims paid in calendar 2008 would then drive limits in fiscal 2009, calendar 2009 would drive fiscal 2010, and so on.
Unfortunately, the RAC program was subject to a several-month delay while various contract issues were being resolved. By the time we were ready to resume work in February 2009, claim data for all of 2008 was available. Recognizing that many providers have grown or contracted due to changes in the economic environment, we decided to use the most current figures available to us instead.

CMS closes the FAQ by indicating this is admittedly confusing and that it will explore alternatives for the future. (CMS also welcomes your suggestions at

This point was not mentioned during the RAC Open Door Forum calls in April. Nor was it included in the outreach sessions CMS and the RACs held throughout April for the provider community, says Nancy Beckley, MS, MBA, CHC, of Bloomingdale Consulting Group, Inc.
Beckley says she isn't certain if CMS' clarification via an FAQ update is adequate at this stage in the RAC rollout process. "This type of change is more suitable for a special announcement on the top of the CMS RAC Web page—as well as via other outreach methodologies that can be used to quickly reach the vast majority of the provider community," she says.

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