December 2012 Archives

December 7, 2012

RACs Correct $2.4 Billion in Improper Payments in FY 2012

According to the latest figures released by the Centers for Medicare and Medicaid Services (CMS), Recovery Audit Contractors (RACs) corrected a total of $2.4 billion in improper payments in fiscal year (FY) 2012, of which $2.29 billion was attributable to overpayments collected and $109.4 million was from underpayments returned. The amount of total corrections in FY 2012 was an enormous increase from the $939.3 million in total corrections reported in FY 2011. Since October 2009, the RACs have corrected a total of $3.43 billion, of which roughly 92% has been attributable to overpayments collected.

Medical necessity of cardiovascular procedures was reported to be the top issue for overpayments in RAC regions A, B and C. In RAC region D, the top issue for overpayments was found to be minor surgery and other treatments billed as inpatient. The top RAC issues for underpayments were not provided by CMS.

If you need assistance in preparing for, or defending against RAC audits, or implementing a compliance program geared toward identifying and correcting potential risk areas related to RAC audits, please contact an experienced health care attorney at Wachler & Associates attorney at 248-544-0888.

December 4, 2012

New Home Health Issues Added to CMS-Approved Issues List for RAC Region B

Recently, CGI Federal, the RAC for Region B, added two new home health issues to its CMS-approved issues list. In the past, RACs have primarily focused their attention on hospitals due to the high bounty they receive for correcting improper claims. However, as displayed in the 2011 RAC statement of work, CMS has directed RACs to begin pursuing other provider types beyond hospitals. The newly approved home health issues for Region B include:

  • No skilled service: To qualify for the home health benefit, a patient must need a skilled service. When a skilled service is needed, dependent services may also be covered. Dependent services are not covered for a patient who no longer needs a skilled service. Claims with no skilled service billed will be reviewed to determine whether the qualifying criteria of having an ongoing skilled service has been met.
  • Skilled nurse length of stay: Late episodes (third and later) receive increased payments, therefore payment incentives exist for extended home health care. Medicare covers skilled nursing services when they are reasonable and necessary. Extended nursing care for observation and assessment may not be covered. Claims for nursing services into the third episode and after will be reviewed to determine if all Medicare coverage criteria is met.

In addition to the new home health issues, CGI Federal also added two new issues targeting physicians in Region B, which include:

  • Incorrect Billing of Diagnosis Codes for Colonoscopy and Sigmoidoscopy: This is an automated review to ensure correct reporting of diagnosis codes for colonoscopy and sigmoidoscopy services.
  • Professional Trastuzumab Off-Label Uses: The purpose for this automated edit is to identify claims for Traztuzumab (Herceptin┬«) being used for off-label indications
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