CMS clarifies new RAC guidelines

The Centers for Medicare & Medicaid Services has begun providing more succinct communications regarding its recovery audit contractor programs (RAC news).

In a letter sent to state Medicaid directors on Oct.1 , CMS deputy administrator Dr. Peter Budetti said the agency would soon implement new guidelines regarding the expansion of RACs specific to the Affordable Care Act. He noted that each state is required to establish its own Medicaid RAC program if one is not yet in place. States must submit their initial plans or begin the process to apply for a waiver by Dec. 31. The agency said it would "maintain flexibility in the design of Medicaid RAC program requirements" for states that are already using outside contractors.

Additionally, CMS has just published two articles in its MLN Matters newsletter discussing what triggers a RAC denial of payment for a claim. It cited a nearly $12,000 claim for a pulmonary biopsy where the hospital claimed the biopsy site was the lung, when medical records indicated it was the bronchus adjoining the lung. It also recommended that "all procedures performed during the admission on the discharge summary or assuring all procedures are easily identified in the medical record documentation."

In a separate article, CMS asserted that some claims are being denied not because they were not medically unnecessary, but because they did not require an inpatient setting to perform.

To learn more:
- read the Budetti letter here
- read MLN Matters article 1 and article 2

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