Recovery audit contractors, previously responsible for issuing demand letters to providers, will shift this responsibility to Medicare administrative contractors. The move reflects the program's desire to increase consistency and efficiency through automation, according to the Centers for Medicare & Medicaid Services.
The RACs will continue to handle this responsibility until January 3, 2012, when the responsibility officially switches over to the MACs. As a result, when a recovery auditor finds that improper payments have made been, it will submit claim adjustments to the MAC, and the MAC will then establish receivables and issue automated demand letters for any recovery auditor identified overpayment.
The MACs will then follow the same process used to recover any other payment, according to the accompanying MLN Matters article.
So how exactly will this affect providers, if at all? According to Kimberly Anderwood Hoy, JD, CPC,director of Medicare and compliance for HCPro, Inc, it should help.
"Many providers face timing difficulties when it comes to demand letters and actual recoupments," she says. "That will be consolidated at the MAC level and thus eliminate the confusion of MAC and RAC coordination."
"It should help providers have more consistency with the process of recoupment and ease the process of anticipating dates of recoupment," she added.
On the other side of things, the transition of responsibility from RAC to MAC raises some concerns for larger facilities, according to Rachel Williams, RHIT,audit contractor coordinatorat Indiana University Health in Indianapolis.
"Our organization has seven acute-care hospitals across the state, and we currently have issues with obtaining audit information from our FI/MAC because they send communication via the addresses on our 855A form which are either physical facility locations or PO boxes in another state," she says. "They don't address [correspondence] to specific individuals as our RAC currently does, so our concern is obtaining and responding to the demand letters within the 30 days prior to recoupment."
"Our organization has a policy that we do not allow recoupment to occur. Instead we refund or appeal, so this transition could impact our response to those deadlines," she continued.
Whether the CMS announcement has a positive, negative, or neutral affect, it remains fact that it's something that providers need to know, because as of January 3 of next year, the letters will no longer becoming from their respective RACs.
James Carroll is associate editor for the HCPro Revenue Cycle Institute.