RAC’s – Will they knock on your door soon?
Many providers have felt the “heat” of an audit performed by a Recovery Audit Contractor (RAC). For those that have not heard of these groups, they are private audit companies that are contracted by Medicare to determine if clinics or hospitals have erred in their medical billing. The process includes an auditing of charts and claims, determination of a percentage of error, and a demand for the percentage of all money received from Medicare for the previous several months to year be returned.
What concerns many providers and medical group administrators about this is the fact that RAC’s are reimbursed based on a percentage of all the money that is returned to Medicare. Certainly, one could argue that this incentive based approach to finding errors in medical claims is questionable.
Read this recent article by Kevin Freking to learn more about RAC’s coming your way.
The contractors have shown they’re pretty good at their work. In just three years, they’ve returned more than $300 million to the federal government — and that’s just from three states. That experiment is winding down. But a larger, national program will soon take its place.
The rollout of “recovery audit contractors” will be gradual. They’ll monitor health care providers in 19 states beginning this spring. In October, an additional five states will join.
Health care providers are nearly unanimous in their dislike of the program’s continuation, much less its expansion. Many lawmakers have similar sentiments, though it was Congress in 2006 that made the program permanent.
