NAHC Report 2011. Copyright National Association for Home Care and Hospice, Inc (www.nahc.org) .— Reprinted with permission
NAHC Report Article
Friday, October 14, 2011
________________________________________ Medicaid RAC Audits: They're Coming Soon! Elizabeth E. Hogue, Esq.
Medicare-certified providers and suppliers who participate in the Medicare Program are familiar with RAC audits that have been conducted for some time. Now the Centers for Medicare and Medicaid Services (CMS) has published final rules requiring states to begin RAC audits of Medicaid providers on January 1, 2012. Private duty home care providers, including those that provide Medicaid waiver services only, will also be subject to RAC audits as of this date.
Here is what all providers need to know about Medicaid RAC audits:
States may exclude Medicaid managed care claims from review by Medicaid RACs.
States may coordinate with Medicaid RACs regarding the recoupment of overpayments.
States must coordinate recovery of amounts due as a result of RAC audits with other auditing entities.
States must make referrals of suspected fraud and/or abuse to Medicaid Fraud Control Units or other appropriate law enforcement agencies.
States must set limits on the number and frequency of medical records to be reviewed by the RACs subject to requests for exception from RACs to States.
Entities that contract with states to conduct RAC audits must have a minimum of one full-time Medical Director who is a Doctor of Medicine or Doctor of Osteopathy in good standing with the relevant State licensing authorities and has relevant work and educational experience, unless an exception is granted by CMS.
Entities that contract with states to conduct RAC audits must hire certified coders, unless the State determines that certified coders are not required for the effective review of Medicaid claims.
Entities that conduct RAC audits must work with the states to develop education and outreach programs that include notification to providers of audit policies and protocols.
RAC audits contractors must provide minimum customer service measures, including:
A toll-free customer service telephone number that must appear in all correspondence sent to providers and all toll-free numbers must be staffed during normal business hours from 8:00 a.m. to 4:30 p.m. in the applicable time zone.
Compilation and maintenance of provider-approved addresses and points of contact. Acceptance of submissions of electronic medical records from providers on CD/DVD or via facsimile.
Notification to providers of findings of overpayments within sixty calendar days.
RAC auditors may not review claims that are older than three years from the date of the claim, unless they receive approval from the State.
RAC auditors cannot audit claims that have already been audited or that are currently being audited by another entity.
Fees paid to RACs must be made only from amounts recovered.
States must determine the contingency fee rate to be paid to Medicaid RACs for the identification and recovery of Medicaid provider overpayments.
Contingency fees paid to Medicaid RACs must be based on a percentage of overpayments recovered.
States must determine at what stage in the Medicaid RAC audit process Medicaid RACs will receive contingency fee payments after recovery.
If providers appeal Medicaid RAC overpayment determinations and determinations are reversed at any level, Medicaid RACs must return contingency fees associated with such payments within a reasonable timeframe, as prescribed by the State.
Contingency fees may not exceed that of the highest Medicare RAC as specified by CMS in the Federal Register, unless States submit and CMS approves a waiver of the specified maximum rate.
States must determine fees paid to Medicaid RACs to identify underpayments.
States are required to adequately incentivize the detection of underpayments.
States must notify providers of underpayments that are identified by the RACs.
States must provide appeal rights under State law or administrative procedures to Medicaid providers that seek review of an adverse Medicaid RAC determination.
Pressure on states to limit Medicaid expenditures, including recovery of as much money post-payment as possible, continues to be very great. This pressure will undoubtedly be felt directly by providers through RAC audits and other mechanisms.