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Proactive Approach Ensures Efficient RAC Request Management
By Lisa Hernandez

Regional West Physicians Clinic (RWPC) in Scottsbluff, Nebraska, is the largest multispecialty medical and surgical group in its area. With roughly 100 affiliated providers, the group’s insurance department includes 13 staff members who process about 20,000 claims each month. The organization is no stranger to Medicare’s recovery audit contractor (RAC) reviews, either; it has been receiving audit requests since the permanent RAC program’s inception in 2010.

At the time RACs began reviewing fee-for-service claims, I was working as RWPC’s main RAC contact as well as working toward a degree in HIM. When I subsequently stepped into the role as insurance manager, I knew that practices and providers soon would be receiving more and more RAC requests. RWPC needed a solid process to proactively manage any uptick.

Effectively managing the RAC process is all about staying one step ahead. To do this, some of the strategies RWPC has found successful include process centralization, diligent tracking, and early warning.

• Centralize the receipt of request letters. RWPC had 19 different clinic locations when RAC audits first began, and the organization had no way of knowing where request letters would be mailed. The fear was that if individual clinics opened the letters, return envelopes would get separated and other issues might arise that could jeopardize timely responses.

Therefore, one of the first steps taken to create a smart management workflow was to establish a central location for the processing of RAC requests. Clinic managers all have been trained not to open RAC letters. Instead, they have been directed to put RAC requests into an interoffice envelope and send them directly to RWPC’s RAC coordinator.

• Track deadlines. With so many moving parts, it is essential to have a tool that helps keep track of each step in the RAC process. RWPC has modified the RAC tracking tool developed for hospitals by the American Hospital Association. Although the amount of reimbursement at stake for hospitals typically is significantly higher than for practices, the tool still helps automatically calculate the number of days RWPC has to complete each RAC requirement, thus helping protect the group from paying back interest and other penalties caused by missed deadlines.

• Get early alerts from remit remark codes. RWPC often receives letters requesting reimbursement without accompanying informational letters explaining why. The organization solves this problem in a timely manner by turning to clearinghouse reports that are generated based on remit remark codes. By running reports on the RAC denial code, RWPC discovers RAC requests before it receives the actual letters. As a result, staff can add these requests to the tracking spreadsheet, along with a notation to watch for the RAC letter.

Meanwhile, as they are waiting for the letter, staff can take steps to request any clinical documentation that may be needed as well as rebill if necessary. This not only ensures timely responses but also helps staff plan their workflows around anticipated RAC requests.

While it’s easy for practices to dismiss RAC audits as little more than a regulatory hassle, RWPC has found it essential to take advantage of the educational opportunities these audits offer. The simple truth is that practices must follow certain rules to be reimbursed properly by Medicare. When those rules are not followed, practices must educate staff to prevent recurrence. Although RACs review claims on a postpayment basis, they nevertheless provide a useful snapshot of the kinds of up-front education practices should implement.

For instance, new patient evaluation and management codes are a common target for RAC audits. Therefore, RWPC has put a process in place to perform prebill audits on all new patient claims. (A report run each night verifies each new patient visit.) Audit findings then are incorporated into provider and staff training, and even integrated into IT system edits where applicable.

There is no getting around the fact that responding to RAC audits is a time-consuming process. Minimizing the effect of RAC audits on workflow—and revenue—requires a proactive approach driven by staff who are detail oriented, organized, and dedicated to keeping up with ever-evolving RAC rules.

The key to effectively managing RAC audits is to adopt more than just a “respond-and-forget” approach. Practices must use the opportunity to evaluate why an audit has occurred and take steps to ensure they will not be audited for the same reasons again.

— Lisa Hernandez is the insurance manager at Regional West Physicians Clinic.