The Centers for Medicare and Medicaid Services (CMS) will continue the transition to new Recovery Audit Program contracts (RAC) by ramping down the audit activity of current contractors.
On February 18, CMS announced that Friday, February 21, 2014, was the last day a recovery auditor could send a post-payment Additional Documentation Request (ADR), and February 28, 2014, will be the last day a Medicare Administrative Contractor (MAC) can issue prepayment ADRs for the Recovery Auditor Prepayment Review Demonstration. Additionally, June 1, 2014, will be the last day a Recovery Auditor may request adjustments by sending improper prepayments to MACs.
The process of entering new contracts for the Recovery Audit Program began in May 22, 2013. At that time, CMS planned to continue with four A/B Recovery Audit Program Regions and the one national DME and Home Health/Hospice Recovery Auditor. The final division of states by RAC was released on January 8, 2014.
Transitioning down the ADRs will allow the current Recovery Auditors to resolve all outstanding reviews and processes before the new contracts are entered. In addition, the delay in activity will allow CMS to make a number of planned changes to the RAC program, including the following:
- Recovery Auditors must wait 30 days before requesting an adjustment by the MAC to give providers an opportunity to initiate a discussion, if needed.
- CMS will established revised ADR limits based on claim types (i.e. inpatient, outpatient).
- ADR limits will be adjusted according to a provider’s denial rate. Low denial rates will result in lower ADR limits; high denial rates will result in higher ADR limits.
To monitor change in the Recovery Audit Program, follow the CMS Recovery Audit Program Recent Updates webpage.
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