CMS Releases RAC Status Document

The Centers for Medicare and Medicaid (CMS) has reported on the status of the recovery audit contractor (RAC) program in Medicare for fiscal year 2007. In the report, CMS highlights improvements that will be made as it implements the permanent RAC program by 2010.

The improvements include a set limit on the number of medical records that contractors may request. The RACs will be required to have certified coders and a medical director on staff for document review and discussion if requested, and they will be required to have a Web-based application to provide status of cases in the permanent program by 2010.

CMS also has issued new guidance for hospitals that are appealing payment denials by the agency and its contractors. The improvement was mandated by Congress five years ago in the Medicare Prescription Drug Improvement and Modernizations Act.

The new guidance affects all Medicare appeals activity, including appeals of medical necessity review denials by fiscal intermediaries and Medicare administrative contractors,  as well as appeals of payment denials by recovery audit contractors.


  1. I would like more information on the RAC.

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  2. I have a question. Are you allowed to use and up or down arrow will the appropriate abbreviation to code a diagnosis from? Example:down arrow NA for the diagnosis of hyponateremia or should you query the physican to clarify and write the diagnosis out? This is for inpatient coding.
    Thank you!

    Deborah liss

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