CMS moves forward with RAC program expansion

CMS is expanding Medicare's Recovery Audit Contractor program to Medicare Advantage, as required by the ACA. The program was originally implemented for Medicare Parts A and B in January 2010.

CMS currently conducts Risk Adjustment Data Validation audits to validate the accuracy of diagnosis data submitted to CMS for payment by Medicare Advantage organizations and to recover net overpayments associated with inaccurate diagnosis data. To increase the percentage of Medicare Advantage contracts subject to an audit and to comply with an ACA provision, CMS issued a request for information on expanding the RAC program to Medicare Advantage in December 2015.

CMS received several submissions in response to the request for information, and the agency is now taking steps to expand the RAC program. On Wednesday, a CMS spokesperson told Becker's the agency "is in the process of contracting with a Recovery Audit Contractor to do additional audits." CMS said it anticipates awarding a contract this year.

Due to a backlog in RAC appeals, the RAC program has been the focus of litigation in recent years. In May 2014, the American Hospital Association; Baxter Regional Medical Center in Mountain Home, Ark.; Covenant Health in Knoxville, Tenn.; and Rutland (Vt.) Regional Medical Center filed a lawsuit concerning the backlog.In December, Judge James Boasberg ordered HHS to incrementally reduce the backlog over the next four years. He ordered the agency to cut the backlog by 30 percent by the end of 2017; 60 percent by the end of 2018; 90 percent by the end of 2019; and to completely eliminate the backlog by Dec. 31, 2020.

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