The progression of Recovery Audit Contractor (RAC) audits: Facing difficulties, undergoing alterations, and the present scenario




The emergence of Recovery Audit Contractor (RAC) audits traces back to 2005, peaking in approximately 2010 before experiencing a slowdown during the COVID-19 period. Congress granted the Centers for Medicare & Medicaid Services (CMS) the authority to initiate the Recovery Audit Contractor program in 2006, starting in New York, Florida, and California.

Initially focused on uncovering coding errors, duplicate services, and fraudulent activities, these audits expanded to Arizona, Massachusetts, and South Carolina in 2007. By 2010, Congress had extended the RAC program nationwide.


However, as the RAC program grew, it posed three significant challenges for providers:


  1. Aggressive RACs: With CMS-funded audit fees based on a contingency model, RACs were incentivized to aggressively target high-value claim hospitals, aiming to maximize denied amounts and their collected fees.

  2. Increased paperwork, limited time: Providers struggled to manage the sudden surge in medical record requests, leading to delayed or denied submissions due to the inability to respond promptly.

  3. Overwhelmed appeals process: The influx of provider claims overwhelmed the Medicare appeals process, causing substantial delays across all levels of resolution due to the system's inability to handle the rapid increase in appeals. This resulted in prolonged waiting periods for claim resolution.

https://www.allzonems.com/evolution-and-challenges-of-recovery-audit-contractor-audits/

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