Recovery Audit Reform Bill Calls for Financial Penalties

James Carroll, October 31, 2012

Proposed legislation before Congress aims to improve the performance of Medicare audit programs and calls for financial penalties for certain compliance failures. The bill also contains a number of significant potential reforms.
Representative Sam Graves (R-MO) introduced the Medicare Audit Improvement Act of 2012 (H.R. 6575) October 16.

Financial penalties
One focus of the bill is on improvement of Recovery Auditor operations. Specifically, the legislation would impose financial penalties—which would go to the Medicare trust fund—on the contractors that fail to meet the requirements for the following:

Audit deadlines Completing a determination of each audit of a hospital the Recovery Auditor conducts within the applicable timeframe.

Timely communication
If a claim is denied, the Recovery Auditor must sent a demand letter to the hospital in a timely fashion.

Overturned appeals
Recovery Auditors must pay a fee to the prevailing party in the case of an overturned appeal. The HHS Secretary will establish a fee schedule to determine the amount of the fee

James Carroll James Carroll is associate editor for the HCPro Revenue Cycle Institute.


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