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Good Grief!
By Judy Sturgeon, CCS, CCDS

No matter how many hospital health information and revenue cycle professionals you ask, it’s unlikely that you will find any who are willing to line up on the side of the recovery audit contractors (RACs). The Centers for Medicare & Medicaid Services (CMS) changed their name to recovery auditors in September 2011, but that really hasn’t changed their image. They’re contractors—head hunters, if you will. The more money they can take back from hospitals, the more they get to keep on commission. So if a physician orders inpatient status for a patient and years later these auditors decide that in retrospect the documentation doesn’t support the inpatient status, then the hospital has to return its entire payment to the CMS.

With the documentation that’s available, legible, and present at the time of coding, coders do their best to assign the correct codes. Financial pressures keep edging the “time to code” closer to discharge and the “time to have documentation completed” farther after coding has been done.

One can understand why there’s no love lost toward the RACs, no matter what name the CMS decides to give them. And there are certainly thieves on the medical forefront committing intentional fraud worth millions of dollars, but facilities generally deal with simple errors. Two main reasons for errors in patient status, coding, and billing are a shortage of nurses for case management positions that oversee the medical necessity of admission status and a shortage of qualified coders to make certain that both coding and diagnosis-related groups (DRGs) are assigned correctly.

But if we step back from the onslaught of denials and recoupments and look at the larger picture, can we find any positive impact from the RAC scope of work?

As taxpayers and as individuals, most readers will agree that billing needs to be correct on Medicare claims. After all, it’s our money that’s paying for them, and we don’t want to be paying out more than we should. We’re all getting older and will likely need Medicare too, so it needs to remain financially sound. Whether the cause is fraud, abuse, or carelessness, overbilling is not OK and needs to be corrected when it’s found. Yes, it’s painful now, but it forces process improvement to best practices instead of supporting the old mentality of “I hope we don’t get audited because we’ll be in trouble.”

As medical professionals, we see careers in case management nursing and hospital coding increasing in value, student interest, and career scope. The experienced coder is a valued partner in a hospital’s revenue cycle team, and case managers with competence in both medical necessity criteria and clinical documentation improvement have employers clamoring for their services.

As hospitals pay the price for prior lax admission practices, they are being forced to demand that physicians cooperate and assign the appropriate patient status for the associated severity of illness and intensity of service. “Medical monarchy” by physicians is giving way to a better partnership between healthcare professionals and their respective facilities. If it isn’t, then ultimately facilities may have to exclude those physicians who don’t consider the hospital’s needs as well as their own.

Communication between departments and medical groups has improved greatly. Data management, release of information, coding, billing, compliance, and case management must work together much more closely on RAC audits and denials. They must be able to cooperate effectively to not only get chart requests out in a timely manner but to analyze findings, launch and track appeals and responses, provide education to all concerned, and handle payments and recoupments. Add to that the need for root-cause analysis and the process improvements necessary to prevent further financial loss when old system shortfalls are identified, and you have quite a list of positive outcomes from an initially negative source.

Do we love the RACs now? Certainly not. Can we say that they were never necessary? Certainly not. But their job is essentially to work themselves out of a job. We should make it our job to help them achieve that goal as quickly as possible. Let’s partner with our physicians, educate our coders and billers in federal regulations, and train our case managers in medical necessity criteria. We need to remember that coding accuracy must accompany productivity, and that coding and billing must be not only prompt but also correct.

We can’t undo the past to avoid the negative effects caused by recovery audits, but we can and must ensure that they create an ultimate good in return for all the grief they have caused.

— Judy Sturgeon, CCS, CCDS, is the clinical coding/reimbursement compliance manager at Harris County Hospital District in Houston and a contributing editor at For The Record. While her initial education was in medical technology, she has been in hospital coding and compliance for 21 years.