RAC Take Backs Accelerate in FY 2012
Recovery of Medicare overpayments picked up dramatically in the first quarter of the new federal fiscal year.
Recovery audit contactors took back $397.8 million in Medicare overpayments in the three-month period ending December 31, 2011, according to new data released by CMS. That figure represents half of the total overpayments RACs collected in the entire 2011 fiscal year ($797.4 million).
The Q1 collection data has not been adjusted to reflect denials overturned on appeal, however.
RACs returned $24.9 million in underpayments during FY 2012 Q1. Correction of underpayments did not leap nearly as dramatically as did take backs.
Medical necessity was at the root of the top issue in each of the four regions in the final quarter of 2011, the latest data available:
- Regions A and C
Neurological disorders: Medicare pays for inpatient hospital services that are medically necessary for the setting billed. Medical documentation for patients with neurological disorders needs to be complete and support all services provided in the setting billed.
- Region B
Cardiovascular procedures: Medicare pays for inpatient hospital services that are medically necessary for the setting billed. Medical documentation for patients undergoing cardiovascular procedures needs to be complete and support all services provided in the setting billed.
- Region D
Minor surgery and other treatment billed as an inpatient stay: When beneficiaries with known diagnoses enter a hospital for a specific minor surgical procedure or other treatment that is expected to keep them in the hospital for less than 24 hours, they are considered outpatient for coverage purposes regardless of the hour they presented to the hospital, whether a bed was used, and whether they remained in the hospital after midnight.
CMS provides quarterly updates on RAC corrections. The updates offer little detail beyond total dollars collected and the top issue in each region. However, figures are provided by region, so it is possible, for instance, to see that underpayments represented just 2 percent of total corrections in region C in Q1 of FY 2012 and 12 percent in region A.
The American Hospital Association offers information such as the success of appeals via its RACTrac initiative, which aggregates data voluntary reported from its member hospitals.