Revenue Cycle

Demand letter responsibility shifted from RAC to MAC

Medicare Update for CAHs, August 24, 2011

Recovery audit contractors had previously been responsible for issuing demand letters to providers, but a transmittal released on July 29 will shift this responsibility to Medicare administrative contractors (MACs). This move reflects the program’s desire to increase consistency and efficiency through automation, according to CMS.

The RACs will continue to handle this responsibility until January 3, 2012, when the responsibility officially switches over to the MACs. As a result, when a recovery auditor finds that improper payments have made been, they will submit claim adjustments to the MAC, and the MAC will then establish receivables and issue automated demand letters for any recovery auditor identified overpayment. The MAC will then follow the same process as is used to recover any other payment, according to the accompanying MLN Matters article.

So how exactly will this affect providers, if at all? According to Kimberly Anderwood Hoy, JD, CPC, director of Medicare and compliance for HCPro, Inc, it should help.

Continue reading on HCPro’s Revenue Cycle Institute.

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