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RAC Appeals Process 'Broken,' AHA Says

   January 16, 2014

In letters to Congress and the head of CMS, The American Hospital Association says stalled Medicare claims totaling more than $1 billion and a growing volume of Recovery Audit Contractor denials are putting its members in "an untenable position."

Overly aggressive and inappropriate audits and denials of hospital claims are holding up more than $1 billion in Medicare payments and the appeals process hospitals have pursued to overturn denials is mired in backlogs contends The American Hospital Association.

In a Jan. 14 letter to Marilyn Tavenner, administrator for the Centers for Medicare & Medicaid Services, the AHA pleads for fundamental changes to Medicare's claims auditing system. The group blasts the system, which it says has a two-year backlog in violation of statutory deadlines and pays auditors commissions for rejected claims without levying penalties for inaccurate denials.

"Hospitals have been put in an untenable position in which the nearly unfettered ability of RACs (Medicare Recovery Audit Contractors) to churn out erroneous denials forces them to pursue appeals in order to receive payment for medically necessary care, while the inability of OMHA (the Office of Medicare Hearings and Appeals) to manage the appeals process within the timeframes required by the Social Security Act holds that payment hostage, " Pollack wrote.


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