AHA: Hospitals Successfully Appeal 72% of Medicare RAC Denials

In the first quarter of this year, hospitals said they appeal roughly 44 percent of all denials from Medicare Recovery Auditors, better known as RACs, and they won those appeals 72 percent of the time, according to the American Hospital Association's most recent RACTrac Survey.

Those figures mirror results from the AHA's previous RACTrac Surveys. The AHA and other hospital groups have aggressively supported legislation to limit the authority of Medicare RACs, which hospitals claim are burdensome and unnecessary at times.

However, the government and RAC supporters say Medicare RACs increase transparency to the Medicare program. Since October 2009, when the Medicare RAC program started, Medicare RACs have recouped $4.5 billion in overpayments from hospitals and other providers.

Here are other key findings from the AHA's first-quarter RACTrac Survey:

•    Sixty percent of medical records reviewed by RACs did not contain an improper payment, similar to the first quarter of 2012.

•    Ninety-six percent of hospitals said medical necessity denials were the costliest complex denials.

•    Roughly 68 percent of medical necessity denials were for one-day stays in the wrong setting, not because the care was not medically necessary — an increase from last year.

•    Three-quarters of all appealed claims are still sitting in the appeals process.

•    About $8.7 billion in Medicare payments were targeted for medical record requests through the first quarter of 2013.

•    Region C, which includes southern states like Florida and Texas and is monitored by Connolly, had the highest number of hospitals reporting RAC activity.

More Articles on Medicare RACs:

Senate Pitches Companion Medicare RAC Reform Bill
Hospital CMO: Fighting RACs "Not a Level Playing Field"
Medicare RAC Overpayment Collections Hit $4.5B Since 2009

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