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RACS

The Centers for Medicare and Medicaid Services (CMS), the federal agency that administers the Medicare program, awarded Connolly Healthcare the contract to provide recovery audit services mandated by the Tax Relief and Health Care Act of 2006.  The Recovery Audit Contractor (RAC) program is a cost containment effort aimed to reduce improper payments within Medicare programs as well as identify process improvements to reduce or eliminate future improper payments.

Connolly Healthcare is tasked with auditing Region C, which consists of the states of: AL, AR, CO, FL, GA, LA, MS, NC, NM, OK, SC, TN, TX, VA, WV and the territories of Puerto Rico and U.S. Virgin Islands.  Yes, Virginia will be audited by Connelly Healthcare.

The following are bullet points that I feel are of interest from Connelly Healthcare’s web site:

  • Inpatient hospitals, Inpatient rehabilitation facilities, skilled nursing facilities and hospices.
    • RACs may request up to 10% of the average monthly Medicare claims (maximum of 200) every 45 days.
    • The CMS web site provides the following example:A Major Medical Center has 12,000 Medicare paid claims in 2007
      • 12,000 claims divided by 12 (months in a year) = avg 1,000 paid claims/month
      • 1,000 paid claims/month x 10% = 100

      Therefore, the limit a RAC may request from the medical center above is 100 medical records per 45 days.

    • Outpatient hospitals, home health and other types of Medicare Part A billers.
      • RACs may request 1% of the average monthly Medicare services (maximum 200) every 45 days
      • The CMS web site provides the following example:

A provider has 360,000 paid services in 2007

        • 360,000 services divided by 12 (months in a year) = avg 30,000 paid services/month
        • 30,000 paid services/month x 1% = 300

However, a RAC may request a maximum of 200 medical records per 45 days because it may not request more than 200 records per 45 days.

  • Physicians
    • The number of records a RAC may request from a physician practice depends on the size of the practice.  For example, a RAC may request a maximum of 10 records from a solo practitioner, whereas it may request a maximum of 50 records from a large group of more than 16 individuals.
    • Other Medicare Part B billers (e.g. DMEs, labs)

RACs may request 1% of the average monthly Medicare services (maximum of 200) every 45 days.