News: CMS report to Congress highlights recovery auditing program

Recovery auditors collectively identified and corrected more than a million claims for improper payments, resulting in $2.57 billion dollars being corrected, according to CMS’ fiscal year (FY) 2014 report on the recovery audit contractor (RAC) program.

The report, posted on October 15, revealed the total corrections identified included $2.39 billion in overpayments collected, and $173.1 million in underpayments repaid to providers.

CMS also addressed efforts to improve the current RAC program. For example, the next round of five-year RAC contracts, going to bid soon, will give providers 30 days before auditors can submit the claim to the Medicare Administrative Contractor for adjustment, CMS says. Recovery auditors will also have to wait until the second level of appeal is exhausted before they receive a contingency fee.

The RAC program’s primary task is to review Medicare claims data and determine if a claim was appropriately paid. They look for billing errors, trends, and piece through clinical documentation to identify overpayments and underpayments. CDI specialists need to understand what RACs have been targeting, so they can focus their efforts and pay close attention to cases that are at high-risk for additional scrutiny. This could help prevent unnecessary documentation-related denials. 

Click here for more information and to view the full report.