Physicians and hospitals will get a short reprieve from Medicare’s recovery audit contractors (RAC), the Centers for Medicare & Medicaid Services (CMS) recently announced. The agency is temporarily halting audits as it reevaluates its contracts and implements improvements for physicians.
The suspension, which is expected to last until sometime in the fall, comes as CMS procures new RAC contracts and transitions down current contracts. The AMA has advocated for changes to the RAC contract guidelines to protect physicians against burdensome audits and erroneous determinations.
As a result of the AMA’s comments on the RAC statement of work, CMS announced program changes that act as much-needed safeguards, including:
- RACs must wait 30 days before asking a Medicare administrative contractor (MAC) to adjust a claim payment. The delay will allow physicians to discuss the audit with the RAC. Previously, physicians had to choose between initiating a discussion and filing an appeal.
- While auditors previously were not required to let physicians know they had received a request for discussion, RACs now must confirm that they have received such requests within three days.
- RACs no longer will receive their contingency fee directly following the recoupment of payments they deemed “improper.” Rather, if a physician chooses to appeal an audit, the RAC must wait until the physician has exhausted the second level of appeal.
“We strongly oppose the RAC program, as we believe that the contingency fee compensation structure incentivizes RAC ‘fishing expeditions’ that are exceedingly burdensome for physicians and often lead to erroneous overpayment determinations,” the AMA stated.
The AMA also urged CMS to restrict reviews to no more than one year after a claim payment was made, penalize RACs for erroneous overpayment determinations and prevent RACs from extrapolating their findings to claims they have not audited.
Although the RAC audits are suspended, automated reviews that do not require additional medical record documentation will continue through June 1. RACs also will complete audits for which they sent requests for additional documentation through Feb. 28. Physicians have 45 days to respond to a documentation request, and RACs have up to 60 days to make a determination on the claim.
The AMA will continue to press CMS to eliminate physicians’ burdens under the RAC program.
