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What You Can Learn From 31 RAC Attacks

Michelle Pointe, for HealthLeaders Media, July 13, 2009

With so much noise about how to prepare for a RAC audit, maybe its best to go directly to the source for your intel: hospitals that have suffered a RAC attack. These hospitals are a few steps ahead of the rest of the country in that they have first-hand experience in what kind of charts are being reviewed, what types of diagnoses are being targeted, and what's being turned down on appeal.

In San Francisco, CA, Alan Rosenstein, MD, a practicing physician, and vice president and medical director of VHA Inc., west coast operations, has spent the last year surveying 31 VHA hospitals in California, New York, and Florida that have gone through RAC audits as part of the CMS demonstration project. The idea is to let hospitals in non-demonstration states know what will happen as RAC moves through the rest of nation, says Rosenstein, who partnered on the project with VHA colleague Michelle O'Daniel.

"Some of the results we found were astounding," says Rosenstein, noting that the hospitals paid back a total $45 million to CMS. A total of 47,243 charts were requested by RAC auditors. One-third were turned down and didn't meet criteria, which was a lot, says Rosenstein. "The main reason was a failure of appropriate documentation and coding that supported medical necessity," he says.

Rosenstein says 50% of the retracted charts were submitted for appeal and a third of those were upheld. This number could be even higher today, he says as the data is six months old. Part of the problem with the appeals process is RAC auditors were looking at 2005 and 2006 charts using 2008 and 2009 criteria. Still, the hospitals won so many appeals, says Rosenstein, because they were able to extract information from the charts that supported clinical necessity, which the reviewers didn't take into consideration.

The VHA data also revealed that the RACs targeted three primary areas: less than 24-hour care, inpatient stays, and rehabilitation. Rosenstein says the RACs also targeted medical diseases such as respiratory, cardiac, metabolic, and nutritional diseases over surgical diseases.

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