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Thursday, November 19, 2009


If you haven't heard of RAC, you will. RAC (the Medicare Recovery Audit Contractor) is coming soon to your neighborhood hospital and physicians offices, if it isn't already there. Certainly the news we're getting about the billions lost to Medicare Fraud is enough to infuriate any American taxpayer. The reporting on this has stated that there is a 40% increase in overcharging by physicians to Medicare. The assumption is that doctors are abusing the system by engaging in fraudulent activity by overbilling Medicare to keep their bottom line in tact. We should be outraged! Hence the reasoning behind independant contractors (RAC) hired by Medicare to hunt down the perpetuators of this fraud. There is no oversight for these independently contracted consulting firms. They are paid by a percentage of how much they recover for the government from the physicians or hospitals they audit. A great incentive to 'recover' as many dollars as possible. Hospitals and physicians are quivering in their labcoats. And it is no wonder. RAC can extrapolate overpayment by applying percentages to overall patient numbers. The dollar amounts could be devastating. And since there is no oversight of RAC, the appeal process for the hospital or doctor is questionable.

But wait, could there be more to this story? This 40% increase in so called Medicare fraud can be linked to the changes in documentation requirements implemented by Medicare over the past couple of years. So the "overcharging" has nothing to do with a change in the behavior or activity of the physicians or hospitals, but rather with a different set of algorithms and documentation requirements being applied to their activity. In other words, their behavior or activities haven't changed, but the rules have changed. And you need a computer with sophisticated software to figure out how to code appropriately for Medicare nowadays! AHA - perhaps that is also part of the 'agenda'.

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