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RAC Restart Facts…(Not Rumors)..So Far

August 12, 2014 2 Comments

Mrs. Jester (the better half)The therapy community is abuzz with all the rumors and misinformation on the RAC restart facts. So far there are a few things that we do know.  We know that CMS wrote letters to members of Congress on Friday August 1st announcing their intention to have a limited restart to the “paused” RAC program. We also know that CMS placed a notice on their website on Monday, August 4th announcing that:

Due to the continued delay in awarding new Recovery Auditor contracts, the CMS is initiating contract modifications to the current Recovery Auditor contracts to allow the Recovery Auditors to restart some reviews. Most reviews will be done on an automated basis, but a limited number will be complex reviews of topics selected by CMS. Work continues on the procurement process for the four Part A / Part B Regions and the national DMEPOS/HH&H Region. The CMS remains hopeful that the new round of Recovery Auditor contracts will be awarded this year.

The CMS website announcement does not contain all the information that was conveyed to Congress including the specification of the automated reviews and limited complex medical reviews that would be untaken once negotiating with the outgoing RAC contractors to modify the existing contract is complete.  Outpatient therapy was specified as a complex review to be restarted in the letter.  Members of the therapy cap coalition group in Washington DC received email communications from CMS regarding the restart including an invitation to the therapy cap coalition members to a conference call with CMS officials that was held last Thursday.

CMS had previously announced that due to the pending lawsuit filed by a disenfranchised RAC contractor (Region B – CGI Federal) in the U.S. Federal Court of Claims that the announcement on the awarding of the 5 new Recovery Audit contracts would be the first of August 15th or the settlement of the CGI lawsuit.  In what might be a play by the Court Jester, CMS might be hedging bets that the lawsuit may not be settled by August 15th and they may not be ready for prime time to move forward with awarding of the 4 regional contracts for the A/B RACs and the single nation wide contract for the Home Health, Hospice and DME RAC.

RAC Restart Facts

Based upon the CMS call and reports from therapy cap coalition members on the CMS call, here is what is playing out:

  1. Outpatient therapy manual medical review of claims over $3700 will be resumed during the limited RAC restart
  2. There is no timeline for resumption, but it is dependent on the negotiation of the contracts ( a modified agreement) with the current RACs (not the future RACs), to take on this project.
  3. CMS in its letter to Congress estimated the project value at $200,000.
  4. CMS indicated that the review of therapy claims will be retroactive to all claims over $3700 beginning with those not reviewed (when the program stopped in February) rolling forward.
  5. All claims will be reviewed on a post-payment basis under this project, though it is not clear if prepayment reviews will commence under this project if the backlog is processed.
  6. CMS hopes to award the 5 new RAC contracts as soon as they are able, and of course this is subject (as always) to award protests by unsuccessful contract bidders.

As the rumors are swirling, and information presented by some may be speculative, stay tuned to the experts at RAC Monitor and the popular Monitor Monday live broadcast/podcast for accurate and up-to-date information.  I am honored to be part of that team, on the team for 5 years, and proud to share accurate, rather than inaccurate or speculative information with the therapy community.

Thank you for being a blog reader, thank you for listening to Monitor Monday.  Let me know if you have questions.


Photo: Will Montague via Compfight


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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. RAC Restart Facts…(Not Rumors)..So Far | HealthBACON | November 21, 2014
  1. Very good post. I definitely appeciate this website.

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