Revenue Cycle

Physician advisors and RACs: Saving grace, defending dollars

Recovery Auditor Report, July 9, 2009

When it comes to surviving RACs, effective physician advisors can be a “saving grace,” according to Elizabeth Lamkin, CEO of Hilton Head Regional Hospital, a Tenet hospital in South Carolina. Lamkin spoke at the Healthcare Financial Management Association’s annual conference in Seattle June 15.
An ineffective program, however, just won’t do.
For example, you may be able to overturn denials without a strong physician advisor program, but at what cost? The American Hospital Association places the cost of managing a Medicare denial at about $2,000 per denial, while the reimbursement for the commonly denied chest pain admission is approximately $3,000, according to Joe Zebrowitz, MD, executive vice president for Executive Health Resources.
“You lose as soon as Medicare denies your claim,” he says. “It’s not enough to be right. You have to be so right that nobody questions you. Because once you are questioned, once you start getting denials, you may win [appeals], but it is a Pyrrhic victory. You may have won the battle, but you’ve really lost the war.”
Trying to ensure you meet medical necessity requirements without physician advisor review is risky. If a first-level review via Interqual or Milliman, for example, doesn’t certify a patient as an inpatient, you need a second-level review by a physician to determine status, says Zebrowitz. This is a best practice, according to the Medicare regulations, the hospital payment monitoring program workbook, and the screening criteria themselves.
And don’t forget to document this second-level review process, because if Medicare sees evidence of a compliant process when they audit, they are far less likely to issue a denial, says Zebrowitz. “[Medicare] knows the likelihood that the denial will be upheld in an appeal is very low.”
Zebrowitz believes the keys to an effective program are fourfold. You need:
  • A team
  • Training
  • Content
  • A QA process
You need a team of physicians, because physicians have different strengths and competencies, Zebrowitz says. You need someone trained in Medicare rules and regulations, someone experienced managing appeals, someone trained in utilization management, and someone who understands hospital compliance, to name a few. A QA process is necessary to ensure your medical decision-making is consistent. And you need to provide your physicians with access to content—“Your silver bullet,” Zebrowitz says—including your local standard of care, literature-based, evidence-based consensus standards.
Editor’s note: Joe Zebrowitz, MD, executive vice president for Executive Health Resources, will be speaking at the upcoming HCPro seminar, “Medicare Compliance Forum: A Strategic Approach to RACs, Observation Status and the Role of Physician Advisors,” which will be held in Atlanta this October.

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