Corporate Compliance

RAC programs

Compliance Monitor, May 25, 2007

Q: How can facilities prepare for the recovery audit contractor program?

A: CMS' draft scope of work (SOW) for the national recovery audit contractors (RACs) was out for comment until April 9. Providers can expect a final document within 90 days after that.

Keep in mind that RACs cannot randomly select claims or target one "solely because it is a high-dollar claim," according to the draft SOW. A RAC can only "target a claim because it is a high-dollar claim and contains other information that leads the RAC to believe it is likely to contain an overpayment."

"Other information" could include the following:

  • A procedure code listed in an OIG report about services that are often not medically necessary
  • A diagnosis code that a RAC believes, based on knowledge from work in the private health insurance arena, facilities may incorrectly code
  • A provider with a high utilization rate compared to other physicians or states
  • A belief that the claim payment was not consistent with Medicare payment policy

Editor's note: Thomas A. Hase, CMS spokesperson, provided the above answer. This Q&A is adapted from an article that appeared in the May 2007 issue of Briefings on Coding Compliance Strategies.

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