What Is The RAC Appeal Process? Mastering Your Recovery Audit

  • Medical Marketing
  • May 26, 2021

Hospitals are faced with the challenges of recovery audits. Understanding the RAC appeal process is essential to mastering the audit process.

All Hospitals Must Face RAC

The recovery audit contractor (RAC) program and the appeal process is a lengthy process for most hospitals. RAC auditors comb meticulously through billing records. Hospital administrators oversee accurate and timely tracking of all RAC-related requirements to ensure a recovery audit or appeal goes smoothly.

viralMD connect What Is The RAC Appeal Process? Mastering Your Recovery Audit

What is the RAC program?

The RAC program was created in 2009 to fight fraud, waste, and abuse in the Medicare program. The program applies to only Medicare parts A & B, and auditors are divided into 5 regions of the United States. RAC auditors review all Medicare claims to find overpayments and inappropriate claim submissions.

Can my facility have a recovery audit?

Clinics and healthcare facilities receiving Medicare payments can encounter a recovery audit. Medical facilities subject to recovery audits include:

  • Hospitals
  • Physician practices
  • Nursing homes
  • Home health agencies
  • Durable medical equipment suppliers
  • Any medical provider that submits claims to Medicare

Keep track of your records

Before a recovery audit, ensure all records are carefully organized and prepared for the RAC auditor. RAC auditors are managing thousands of cases, so the easier for the auditor to review the documents, the better.

Centralize RAC event management

Healthcare organizations are advised to centralize RAC activities in a skilled healthcare information management (HIM) system. Through HIM systems, professionals can receive, review, and coordinate any responses to RAC queries or denials.

RAC appeal can be worth your time

An RAC appeal process can take 12-24 months per claim and is broken down into 5 appeal levels. Each level has a different entity reviewing the request and a specific time in which the application can be submitted. While the appeal process is lengthy, pursuing an appeal can be worthwhile, as a majority of denied claims during a recovery audit are overturned during the RAC appeals process.

How to begin a RAC appeal

The 5 levels of a RAC appeal process are as follows: redetermination, reconsideration, administrative law judge (ALJ) hearing, Medicare Appeals Council review, and the US District Court. To start an appeal and avoid the recoupment process, file a written request to the Medicare contractor within the first 30 days.

Where to begin?

A recovery audit plan can spot common billing errors and alert hospitals to new changes to RAC audit areas. If a claim denial occurs, be quick to respond and submit an appeal. Hospitals nationwide undergo recovery audits, so the most important thing is to be prepared.

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