Medicare RAC Audits

If your medical facility provides Medicare or Medicaid services, RAC audits may feel like a looming threat to your livelihood. These audits, also called Medicare audits, are designed with the sole purpose of collecting reimbursement from your facility. Even the most diligent, compliant practitioners have holes in their RCM process that RAC audits can find.

Coronis Health offers unmatched expertise in preparing for RAC audits. With more than 2,000 employees and 31 million claims processed each year, our medical billing and RCM specialists understand how to keep your facility compliant and avoid ever-growing RAC fees.

What Are RAC Audits?

Recovery audit contractors, or RAC audits, aim to uncover fraud and abuse of the Medicare program. The program, which launched in 2003, separates regions in the U.S. into four distinct areas and includes a fifth category for Durable Medical Equipment (DME) and Home Health / Hospice (HHE) claims.

RAC audits primarily target instances of overpayment or underpayment. Overpayment occurs when medical providers bill for complex procedures that are actually more simple than what was stated, resulting in a higher reimbursement. Contrarily, underpayment happens when providers bill for a simple procedure that is actually more complicated. 

RAC Fees

According to CMS.gov, RAC audits have recouped approximately $10 billion for the Medicare program since 2009. The program, though created to protect taxpayers against physician overpayment, comes with a catch: RAC contracts are contingency-based. 

Audits that rely on contingency-based reimbursement incentivize your auditor to identify holes in your RCM at all costs. If the auditor finds no red flags during their investigation, they can lose their contract with the Centers for Medicare & Medicaid Services (CMS).

Compliance

The burden of compliance is the responsibility of healthcare providers. Outside of basic written guidelines, Medicare will not provide any specific guidance to the physician or provider.

Internal changes for practices should be established to monitor documentation and coding for compliance as well as establish a framework for tracking RAC requests. These are not new requirements to providers. 

The provider application and contract clearly state that it is the sole responsibility of the physician to follow all documentation rules and regulations, coding and billing rules 100% of the time. Offices setting up compliance guidelines should appoint someone who will be responsible for monitoring compliance regulations.

What Triggers An RAC Audit?

Physician coding error rates average 62%. In addition to being a Medicare/Medicaid provider, many reimbursement audits are triggered by coding, billing, and utilization anomalies. Physician coding error rates alone average 62%. You must change and improve the behaviors, coding and billing patterns, and skillsets of staff and providers, and become a precise, fully-compliant documentation, coding, and billing team.

When audits do occur, you can attempt to defend yourself, however, your staff may not understand the best way to shield you and your practice. Many practices turn to their lawyers, but this method can be extremely expensive. Not only will an audit often entail substantial legal fees, but also large consulting fees for shadow audits and external professional advice will need to be obtained during the process. Since RAC/MIC/MAC audits are conducted on an ongoing basis, retaining an attorney specifically for audit defense appears to be an unrealistic option.

The Coronis Health Pre-RAC Audit Program

Coding errors are the largest threat to your revenue cycle management process. If you’re at risk of an RAC audit, Coronis Health has the necessary experience to minimize coding errors and ensure you remain 100% compliant. We offer a proprietary coding and documentation chart review program designed to help individual physicians and medical facilities avoid future RAC audits.

At Coronis Health, your coding and documentation audit specialist will review all of your procedure and diagnosis codes, documentation, and patient records, along with EOBs and payers contract for the past six months, to assess your compliance. Based on the review, we will give you a detailed report on any areas of concern and vulnerability to determine the next steps for your medical facility.

Coronis Health has a skilled team of certified medical billers and coders to maximize reimbursement for your facility and reduce your risk of RAC audits.
Schedule a free financial health assessment today to find out how we can help increase revenue for your facility.