RACs collected nearly $2 million from skilled nursing facilities last year, report shows

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Recovery Audit Contractors recovered $1.8 million in Medicare overpayments made to skilled nursing facilities in fiscal year 2013, according to a Congressional report released Monday.

The amount increased significantly from a year prior, when a pilot program identified about $8,000 in SNF overpayments. In fiscal 2013, the Region D auditor began reviewing skilled nursing facility claims for spans of care, the Centers for Medicare & Medicaid Services noted in its report. These reviews encompassed all the claims for a given beneficiary from the date of admission through discharge. Region D is made up of 17 states stretching from the Midwest to the West Coast, and it includes California.

The RACs also restored more than $19,500 in underpayments to skilled nursing facilities last year, according to the report.

Overall, RACs collected $3.65 billion in Medicare overpayments, and its prepayment reviews blocked $22 million from being disbursed, CMS reported. The auditors recovered roughly $2.3 billion in overpayments in fiscal 2012.

The beleaguered RAC program has drawn criticism from providers, who say auditors are overly aggressive. The providers have appealed a huge number of decisions, leading to a staggering backlog at the Administrative Law Judge level. CMS paused the program and pledged to improve it.

The auditors' association said the latest report shows how effective RACs are, and touted the findings of an independent validation contractor. The contractor found that RAC determinations are accurate more than 95% of the time.

“Each year, the RAC Report to Congress reinforces the success of the RAC program and the critical role these contractors play in our nation's healthcare system,” said Kristin Walter, spokesperson for The American Coalition for Healthcare Claims Integrity.