HFMA ANI 2009: Tenet's experiences with RACs

Audit, audit, audit -- and while you're at it, document, document and document some more. Those are the mantras that have helped one Tenet hospital survive an initial audit by the dreaded Recovery Audit Contractor program, despite getting hit early in the program before anyone knew what to expect.

Obsessive preparation allowed the facility, South Carolina-based Hilton Head Regional Hospital, to win 29 of its 31 RAC appeals, said CEO Elizabeth Lamkin, who spoke at this week's Healthcare Financial Management Association ANI 2009 conference.

HHRH had a process improvement team in place a year before the RAC began its audit, which put the hospital in a much better position to answer the RAC's questions, Lamkin notes. That was true even though the hospital was audited during the demonstration program, when information on how to respond to RACs was even more scarce than it is today.

HHRH developed a policy of auditing coding and medical necessity determinations repeatedly during the patient care process. Then, when the hospital was told it was being audited, it had all of the documentation in place and was able to satisfy the RAC examiners.

To stay ahead of future RAC actions, HHRH has established a RAC task force, led by its head of case management, to review the RAC audit findings and results and respond appropriately. "If you have everything together you're not an easy target anymore," Lamkin says.

The hospital has also hired a physician advisor whose job it is to review cases that might not meet CMS medical necessity cases. Lamkin and her team make sure that the PA carefully documents their conclusions during the review. "When you're being audited, those notes can be extremely helpful," she says.

To make sure it manages discharges properly, HHRH is following up with skilled nursing facilities to make sure the actual level of care provided matches the "discharge disposition" codes. Otherwise, it could end up having funds taken back by the RAC, as the hospital is paid differently depending on what care the patient gets post-discharge.

Yet another component of a successful RAC-ready operation is to make sure the hospital gets its compliance officer involved in monitoring for potential RAC problems. He or she should evaluate RAC requests to see if they point to hospital resources, Lamkin suggests.

And don't forget getting your physicians on board, Lamkin advises. To educate them on the issues, HHRH has begun giving physicians a list of their records that got audited by the RAC, along with the outcome of each review. What's more, it's important to audit records that haven't gotten any objections from the RAC, and let physicians know if there's something wrong with them. "You have to make sure they see the consequences, or they don't care," she says. "Make sure you tell them 'You would fail this audit.' Then they start to listen."

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