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Florida Rehab Providers Now Receiving RAC Demand Letters

November 10, 2009 1 Comment

Florida therapy providers are beginning to report the receipt of official “demand letters” from Connolly Healthcare, the Region C Recovery Audit Contractor.   A Florida therapy provider, who asked not to be identified, has reported receiving several demand letters related to the billing of speech therapy untimed codes in units greater than one.  This provider has multiple Florida facilities and the improper billing was found, upon internal investigation to be limited to one facility and individual and likely due to a communication error. 

Connolly (Region C) was the first RAC to post CMS approved issues for automated review.  Among those issues posted was Untimed Codes, as noted in the RACMonitor article predicting likely outpatient rehab targets: .

The same rehab provider has received additional RAC demand letters regarding speech therapy untimed evaluation codes being billed simultaneously with speech therapy untimed treatment codes.  The findings of an internal and external investigation has led the provider to initiate appeals on claims where two  different untimed codes were billed on the same day (on the same claim).

Untimed Codes being billed in increments greater than one were noted in the RAC Demonstration in California, New York and Florida.  The RAC issue with Speech untimed codes has been on the radar screen in rehab cirles for some time due to the $3.2 million in improper speech therapy payments discovered in the RAC demo.  

Health Data Insights (Region D) and CGI (Region B) both posted Untimed Codes as a CMS approved issue for automated review.  It is likely that DCS Healthcare (Region A) has also requested CMS to approve this issue .

Connolly describes the issue as “CPT Codes (excluding modifiers KX, and 59) where the procedure is not defined by a specific timeframe (untimed codes), the provider should enter a one (1) in the units billed column per date of service.”  Additional information for providers provided as a reference by Connolly:  CMS Pub 100-04, Transmittal 1019, dated 8.3.06, pages 7-11, and CMS Pub 100-04, Ch. 5, § 20.2.  The Connolly reference can be reviewed at:

For a refresher on avoiding problems with the issue of Untimed Codes there are suggestions in the following article:  (originally published in

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Nancy Beckley

Nancy J. Beckley MS, MBA, CHC: President-Nancy Beckley & Associates LLC. Compliance outsourcing, risk assessment, compliance plans, compliance training, auditing, due diligence, investigation support for therapy providers.

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  1. The Senate Democratic health care reform bill provides for the expansion of the Recovery Audit Contractor program. See my Medicare Update post at

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