Revenue Cycle

Make sense of Medicaid RACs

Recovery Auditor Report, December 30, 2010

Signs are pointing to the fact that Medicaid RACs might not be the stuff of unicorns or Santa Claus.

As of September, CMS is taking steps toward Medicaid RAC implementation, as required by the Patient Protection and Affordable Care Act. This comes as no surprise, says Elizabeth Lamkin, MHA, president of Dalzell Consulting Group, Inc., in Hilton Head, SC. “There is a huge incentive to expand the RAC program to Medicaid.”

CMS expects states to fully implement their RAC programs by April 1, 2011. Because the individual states administer Medicaid, the expansion of RACs into Medicaid may in fact prove difficult, Lamkin says. “We do not know how the RAC contractors will interpret state rules or work with providers,” she explains. “We may see the problems, much as we did in the Medicare demonstration project, based on a learning curve for providers and RAC auditors.”

Providers should prepare for Medicaid RACs by educating themselves on state Medicaid rules and conducting audits on high-volume Medicaid procedures to determine whether bills meet criteria. In the Medicare RAC demonstration project, coding and medically unnecessary services or settings caused most of the overpayments, which providers need to learn from, says Lamkin. “Make this part of your RAC committee work and treat it like the Medicare RAC preparation.”

Editor’s note: For additional tips, subscribe to HCPro’s Medical Records Briefing. Subscribers can find the article in the December issue of their newsletters.

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