Skip to main content

On the RAC--the recovery audit contractor informational letter and me

In 2003 the Medicare Modernization Act established the Recovery Audit Contractor (the RAC) program to evaluate Medicare overpayment. It was extended to involve all 50 states in 2006 and will eventually involve Medicaid payments as well. The government hired 4 companies to audit payments to hospitals, durable medical equipment suppliers, physicians and other providers throughout the country. Health Data Insights is responsible for the largest geographical area, including my state, Idaho.

Since 2006 we have expected visits and inquiries from various individuals involved in the audits, and eventually we expect that we will all be presented with requests for repayment of money to Medicare in settlement of what the auditors believe are overpayments. This is definitely happening but, other than various highly publicized cases of fraud, I haven't heard that this process has been particularly odious or destabilizing. Nevertheless, in Medicare's report to Congress last year (http://www.cms.gov/Research-Statistics-Data-and-Systems/Monitoring-Programs/Recovery-Audit-Program/Downloads/FY2010ReportCongress.pdf) 92.3 million dollars in "corrections" were reported for 2010. 18% of these were actually underpayments and the rest overpayments. The auditing companies were paid based on recovery, and were allowed to keep 9-12.5% of the money they recovered.

In July a letter came to me at the hospital (where I only pick up mail sporadically) which reported what the auditors felt was an overpayment. Apparently their automated system noticed that both I and another physician had billed for discharge services for a patient on the same date, and they intended to reopen the claim and send me an adjustment letter. The letter they sent me was informational only, and began a "discussion period" during which I could send information that might affect the claim. I was given a website (www.racinfo.com) at which I could find a discussion period submission form. It wasn't obvious where to find that, but it was available under the provider information tab.

I reviewed the medical records and found out that I had, in fact, taken care of the patient and discharged her on the date in question, and I printed out a screen shot of the medical records which was blurry enough that I knew it wouldn't fax. So I called the provider relations number (866) 376-2319 and actually talked to a real person. I asked her what happened, why they couldn't read just as well as I that the claim was valid, and she explained that there had, in fact, been two claims by different doctors (me and one of my partners who had taken care of the patient earlier) for the same service and that they hadn't looked at any medical records, just the automated billing. I'm a bit annoyed, but I guess it makes some sense that the burden of proof would be on the doctors who got the disputed payments. I will send them the records tomorrow. If all else fails, I will pay the disputed amount which is only a bit over $73.

Mostly doctors don't bill for hospital services, but communicate what was done to a billing office. We have pretty much no clue what happens after that, other than, in some general way, we get paid. If we work for a small group, we see a spreadsheet which shows that we made so much money from hospital work and then we eventually get money based on overhead and the various things that were paid to us for the myriad of services we provide. It's actually pretty amazing that huge orders of magnitude mistakes don't happen all the time, and so perhaps they do. I suspect that the fact that this patient's discharge was billed twice was an error of foggy wits, not of evil intention, but it is likely that such mistakes are very common and ongoing.

The most common error mentioned in the report to congress, which resulted in the greatest amount of claims adjustment was billing for medical equipment that a patient used while hospitalized. Hospitalization costs are bundled for medicare and the hospital receives the same amount of money for a certain diagnosis and level of service intensity regardless of the resources they use. If Medicare is also billed for medical equipment used during the hospitalization, this is clearly a mistake. If it is a mistake that has resulted in millions of dollars in recovered payments, my guess is that this is because of a colossal misunderstanding resulting from a ridiculously complex payment structure.

The details of medical billing are so complex that people in billing offices need to go to classes to learn how to do it and the people who provide the services (doctors etc.) are usually not aware of what is being billed. When we do see the details, it is hard to make sense of them and so most of us go no further than shaking our heads. I am completely willing to believe that a significant amount of the billing for my services could be inaccurate. It is very likely that a non-negligible portion of the work I have done in the last 25 years was never even billed, since it requires some effort on my part to report what I have done to the billing department, and on a busy day that is the least of my concerns. Even if I do report my work, there is a good chance the communications could be lost in transit or could be misunderstood or wrongly transcribed. It makes perfect sense that Medicare would hire auditors to look for mistakes. For Medicare, the RAC is a clear win, since they pay only commissions on the recovered money. For us as physicians it is scary and annoying, and if it is financially painful will probably make us more careful.

A physician I know from Canada told me that she does have to bill the government for her services, but it is incredibly easy. She just does it on the computer at the end of each week. Errors and fraud are nearly unavoidable with the system we now have, and the remedy we have chosen (RAC) is painful and time consuming. It will make overworked and disillusioned physicians approach their jobs with even less energy and enthusiasm, which is far from a desired outcome. Reform of the fee for service system is in the works, and it truly can't come soon enough.


Comments

Popular posts from this blog

How to make your own ultrasound gel (which is also sterile and edible and environmentally friendly) **UPDATED--NEW RECIPE**

I have been doing lots of bedside ultrasound lately and realized how useful it would be in areas far off the beaten track like Haiti, for instance. With a bedside ultrasound (mine fits in my pocket) I could diagnose heart disease, kidney and gallbladder problems, various cancers as well as lung and intestinal diseases. Then I realized that I would have to take a whole bunch of ultrasound gel with me which would mean that I would have to check luggage, which is a real pain when traveling light to a place where luggage disappears. I heard that you can use water, or spit, in a pinch, or even lotion, though oil based coupling media apparently break down the surface of the transducer. Or, of course, you can just use ultrasound gel. Ultrasound requires an aqueous interface between the transducer and the skin or else all you see is black. Ultrasound gel is a clear goo, looks like hair gel or aloe vera, and is made by several companies out of various combinations of propylene glycol, glyce

Ivermectin for Covid--Does it work? We don't know.

  Lately there has been quite a heated controversy about whether to use ivermectin for Covid-19.  The FDA , a US federal agency responsible for providing unbiased information to protect people from harmful drugs, foods, even tobacco products, has said that there is not good evidence of ivermectin's safety and effectiveness in treating Covid 19, and that just about sums up what we truly know about ivermectin in the context of Covid. The CDC, Centers for Disease Control, a branch of the department of Health and Human Services, tasked with preventing and treating disease and injury, also recently warned  people not to use ivermectin to treat Covid outside of actual clinical trials. Certain highly qualified physicians, including ones who practice critical care medicine and manage many patients with severe Covid infections in the intensive care unit vocally support the use of ivermectin to treat Covid and have published dosing schedules and reviews of the literature supporting it for tr

Old Fangak, South Sudan--Bedside Ultrasound and other stuff

I just got back from a couple of weeks in Old Fangak, a community of people living by the Zaraf River in South Sudan. It's normally a small community, with an open market and people who live by raising cows, trading on the river, fishing and gardening. Now there are tens of thousands of people there, still displaced from their homes by the civil war which has gone on intermittently for decades. There are even more people now than there were last year. There is a hospital in Old Fangak, which is run by Jill Seaman, one of the founders of Sudan Medical relief and a fierce advocate for treatment of various horrible and neglected tropical diseases, along with some very skilled and committed local clinical officers and nurses and a contingent of doctors, nurses and support staff from Medecins Sans Frontieres (Doctors Without Borders, also known as MSF) who have been helping out for a little over a year. The hospital attempts to do a lot with a little, and treats all who present ther