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Why Your Medical Billing Company Should Provide Pre-RAC Audits

November 6, 2014

Pre_RAC_auditsGood coding and documentation consists of detecting red flags in billing patterns, which is why your medical billing company should consider providing Recovery Audit Contractors (RACs). RAC programs reduce claim errors, identify both underpayments and overpayments, and expose charges of fraud or abuse.

More than one billion dollars in overpayments have been recovered through RAC programs.

Payment errors occur for several reasons. For one, they may be issued with incorrect service codes. Other times, Medicare may be billed as a primary payer instead of a secondary payer. Additionally, providers may bill duplicate claims, fail to submit documentation when requested, forget to send the appropriate documentation to support the claim, use outdated fee schedules, and issue payments made for services that do not meet Medicare’s necessity criteria. Because it is likely that payment errors will occur, medical billing companies must monitor current and future RAC targets frequently. This will help them identify current and potential risks tremendously.

Pre-RAC audits work like this: if a client is at risk for being the subject of one, a medical biller will assess the provider and review both past and current claims. Once they have done that, they will perform pre-RAC audits to assess risk exposure and recommend corrections to the client in hopes of avoiding possible penalties.

Providing pre-RAC Audits have been beneficial for medical companies everywhere. Successful implementation of a RAC program will cure any underpayments and recoup overpayments under part A or B of the Medicare program. If your medical billing company is interested in implementing a RAC program, make sure you comply with regulations enforced by Centers for Medicare and Medicaid Services (CMS) regarding claim submissions, processing, and payments. 

If you are interested in learning more about why your medical billing company should provide Pre-RAC audits, please feel free to visit our website at any time


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