Medicare RAC project targets prepayment claims

A new Medicare Recovery Audit Contractor (RAC) project will emphasize prepayment reviews of claims that historically have resulted in high rates of improper payments.

Primary care physicians who are ensnared in one of the reviews could see a 75-day delay in payment, according to the American Academy of Family Physicians (AAFP).

Initial reviews will scrutinize hospitals, but doctors eventually could hear from the contractors as well.

“Although the first stage of the project targets hospitals, queries for any missing information will be made to the admitting physician,” Debra Seyfried, a coding and compliance specialist, told AAFP News Now.

The idea behind the new approach is to break from the traditional “pay and chase” method of targeting improper payments after they occur, according to the Centers for Medicare and Medicaid Services (CMS).

The new project will begin with reviews of short inpatient hospitals stays, according to CMS.

The 3-year demonstration project begins August 27 and will be based in the following 11 states: Florida, California, Michigan, Texas, New York, Louisiana, Illinois, Pennsylvania, Ohio, North Carolina, and Missouri.

If CMS officials consider the project a success, it could be implemented across the nation.

More information on the new RAC program is available in this CMS presentation.

Earlier this year, a Government Accountability Office report urged CMS to do more to detect Medicare fraud, such as stepping up prepayment claims reviews.

The new RAC demonstration project appears to be CMS’ answer to that recommendation.

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