Why are more RAC audits happening? There are trillions of reasons

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John O'Connor, editorial director, McKnight's Long-Term Care News
John O'Connor, editorial director, McKnight's Long-Term Care News
Recovery audit contractors are stepping up their efforts to review Medicare billings.

In fact, a survey conducted by the American Hospital Association found that RACs requested 546,000 medical records in the second quarter of 2012. That's a 22% increase over the 448,000 records in the previous quarter, according to the survey. Many long-term care operators view this crackdown as a troubling development.

In recent years, many nursing homes have seen Medicare become their fastest-growing revenue stream (largely for rehab-related services). And as nursing homes increasingly partner with hospitals, this trend should continue. Or will it?

To be clear, nursing homes should be held accountable for every dollar they seek from the Treasury. And the Centers for Medicare & Medicaid Services should take every reasonable step to detect fraud and ensure tax dollars are not being squandered.

But this appears to be a classic case of auditors gone wild. In March, CMS gave RACs the authority to request twice as many health records from skilled nursing facilities as they were previously allowed to. And as they say, there's a fine line between policing and police brutality. Given the excessive enthusiasm some RAC auditors have shown, it's hardly surprising that providers and even lawmakers are taking issue with this enhanced approach to billing accountability.

Which begs an obvious question about the enhanced tactics: Did providers suddenly become less trustworthy, or is there another reason? You don't have to be a detective to conclude it's the latter. Actually, there are trillions of them.

Our federal government has become the world's largest debtor. How much are we in hock? Opinions and calculations vary. But the general consensus is that the national debt now exceeds $16 trillion. That's a 16 followed by a dozen zeros.

And it's not like things are getting better. In fiscal year 2011, the budget deficit was projected to surpass $1.2 trillion. In the previous year, it was $1.57 trillion.

Simply put, our government is spending far more than it takes in. This is not a new problem, but it is a worsening one.

So it should hardly be a surprise that CMS and other agencies are trying to help balance the federal ledger. One option here is to issue more claims denials. According to the AHA survey, that is clearly happening more often.

Why are hospitals and skilled operators bearing the brunt of this effort? To borrow a line from The Godfather: “It's not personal, it's just business.”

But when it comes to overzealous RAC audits, what we're seeing lately looks a lot more like unjust business.


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Daily Editors' Notes

McKnight's Daily Editors' Notes features commentary on the latest in long-term care news and issues. Entries are written by Editorial Director John O'Connor, Editor James M. Berklan, Senior Editor Elizabeth Newman and Staff Writer Marty Stempniak.