The Centers for Medicare & Medicaid Services will "pause" additional documentation requests by current RAC operators until new contracts are finalized. RAC is a controversial federal program that uses private contractors to audit hospital billings, looking for Medicare reimbursements paid in error. Over the last two years, four RAC companies have collected more than $2 billion.
The agency announced five changes that will take effect in the next set of RAC contracts, including requiring auditors to wait 30 days to allow for a discussion before sending the claim for adjustment.
Melissa Jackson, senior associate director of policy at the American Hospital Association, says the changes are a good first step, but further reform is needed. Some hospitals wait close to three years before they know whether a claim denial will be overturned, and the changes don't address that lengthy appeals process.
The AHA supports a bill that would establish a limit on medical record requests, penalize RACs that fail to comply with the program and allow denied inpatient claims to be bill as outpatient claims in some cases.