Revenue Cycle

Could RAC mass adjustment changes mean increase in automatic audits?

Recovery Auditor Report, November 12, 2009

Providers who believe their RAC denials will be limited to 200 every 45 days (corresponding with the medical record request limits) may be in for a surprise. Those limits apply only to complex audits, but no such limits exist for the number of automatic reviews RACs can perform.
“RACs can do as many [automated reviews] as they want. I think it is in people’s heads that they can look at only 200 at any one time, but that’s really not true,” says Kimberly Anderwood Hoy, JD, CPC, director of Medicare and compliance for HCPro, Inc.
In fact, recent changes to the RAC process for handling mass quantities of recoupments from automatic reviews may even make it easier for RACs to increase their auditing capabilities—meaning the potential for even more denials for providers.
In the past few weeks CMS released three transmittals (R561OTN, R571OTN and R573OTN) detailing several technical changes to “enhance” the RAC mass adjustment process. Essentially, the changes improve the process for the RACs by automating what used to be much more labor-intensive process of initiating mass adjustments of similar claim and/or service types.
“CMS is going to allow RACs to now upload entire files to the intermediary to make mass adjustments, and this is going to make automated denials much quicker for RACs,”
Hoy says. “And whenever you go from manual to automated, you’re going to have a huge increase in efficiency. The changes mean a hospital could get literally thousands of claims denied in one day.”
CMS first came out with a RAC-oriented mass adjustment process in 2007, but the changes should make it easier for the RACs. “Basically they can just run reports now,” Hoy explains.
And if the back-end work involved in processing mass quantities of automatic denials decreases for the RACs, does it mean an increase in their ability to further audit healthcare providers?
We may have to wait until April 5, 2010, when the changes take effect, to find out.

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