RAC Targets Skilled Nursing Facilities' Consolidated Billing

Although SNFs will be the primary target when tracking down overpayments related to consolidated billing, Wachler anticipates that the RACs will also look at vendors when auditing for Part B items and services.

"If a RAC does identify an overpayment, providers should aggressively appeal the decision," Wachler says. "We had a very good success rate for appeals in the demonstration project, but, unfortunately, many providers didn't appeal. There were only appeals in 22.5% of the cases in the demonstration project, so the RACs recouped a large amount of money without anyone challenging their decisions."

Although SNFs were not a main focus of the demonstration, Wachler believes the RACs will increase their efforts to identify SNF overpayments as the program progresses.

"The contractors are adding to their lists of audit issues and I think it is only a matter of time until we see SNFs getting hit hard by the RACs," Wachler says. "I don't think you can really avoid a RAC audit, but you can make yourself a hard target by putting procedures and processes in place to make sure you understand the requirements, are in compliance, and properly document the medical necessity of the services you provide."