The long wait for medical necessity Recovery Audit Contractor (RAC) reviews will soon be over. The Centers for Medicare & Medicaid Services (CMS) has approved the first "medical necessity review" audits for the recovery audit contractor (RAC) program, according to a statement by the American Hospital Association(AHA).
"This should certainly not come as a surprise to providers," said Debbie Mackaman RHIA, CHCO, regulatory specialist for HCPro, Inc. "We've been waiting for these reviews since the implementation of the permanent program, often wondering what might be taking so long."
CMS takes the position that the decision to admit a patient is a "complex medical judgment" made by the patient's physician after consideration of the severity of the signs and symptoms; medical probability of an adverse outcome for the patient; and the need and availability of diagnostic studies.
A RAC will have to find clear evidence in the medical record using CMS and clinical guidance to make the opposing determination that the physician's judgment was correct, according to Mackaman.
"This will be an interesting twist to the current set of approved issues, which are more 'cut and dry'," said Mackaman.
The newly approved audits include 18 types of inpatient hospital claims and one durable medical equipment claim. It is unclear as to which RACs will post which issues to their websites, as required by CMS. According to the AHA, these issues, as well as the accompanying additional documentation requests (ADR), are expected to be released within the next two weeks.
When providers receive these ADRs, they should take the time to carefully review all documentation well in advance of receiving the review results letter, suggests Mackaman.
"The review should involve clinical staff and CDI specialists, as well as a physician advisor in preparation for a denial and possible appeal," she says. "Knowing where you stand and being prepared to take on the denial will save critical time as these issues continue to unfold."
It is hoped that hospitals have been heeding the advice to prepare for the medical necessity phase of the permanent RAC program, but if they haven't, they certainly can't put it off any longer, said Tanja Twist, MBA, HCM, director of patient financial services at Methodist Hospital of Southern California in Arcadia, CA.
Among the critical items facilities must be prepare for, Twist said, are:
"The industry simply can't afford to bury its head in the sand any longer," says Twist. "The RACs are coming."
James Carroll is associate editor for the HCPro Revenue Cycle Institute.