Hospitals, lawmakers reaffirm calls for RAC reform

Newly proposed bipartisan legislation would modify Medicare recovery auditors (RACs), in part by placing a hard cap on the number of documents they can request from hospitals.

The reintroduced Medicare Audit Improvement Act would cap Additional Document Requests (ADRs) to 2 percent of hospital claims with a maximum of 500 ADRs every 45 days, House Reps. Sam Graves (R-Mo.) and Adam Schiff (D-Calif.) announced yesterday.

"Doctors and nurses should be focused on caring for patients, not trying to comply with the ever-increasing requests for documents," said Graves, who called the ADR reforms "common-sense."

The bill aims to alleviate the administrative burdens of handling medical record requests, especially for small, rural hospitals, the co-sponsors noted.

The American Hospital Association voiced similar concerns with the recovery auditor program, complaining the abundance of audit programs are "drowning hospitals with a deluge of duplicative audits, unmanageable medical record requests and inappropriate payment denials," AHA Executive Vice President Rick Pollack said yesterday in a statement

So it's no surprise the AHA has once again thrown its support behind the measure, applauding its ability to make RAC activity more transparent and enable denied inpatient claims to be billed as outpatient when appropriate, according to the statement.

The hospital group supported the measure when it was first introduced in October 2012.

Demonstrating hospitals' concerns, the number of medical records RACs requested jumped roughly 10 percent to 720,590 during the fourth quarter of 2012, according to AHA's latest RACTrac Survey.

Almost a year ago today, the Centers for Medicare & Medicaid Services expanded the number of records RACs could request from hospitals and skilled-nursing facilities, as well as the maximum limit. For facilities with more than $100 million in Medicare severity diagnosis-related group payments, CMS increased the cap from 500 to 600 documents, FierceHealthFinance previously reported.

To learn more:
- here's the announcement
- read the AHA statement

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