Ask the payment expert ... about the observation stay loophole

I thought the Recovery Audit Contractors were on hold, so why did I receive a request from our RAC for a Medicare Advantage resident? 

Recovery Audit Contractors are on hold. The “pause” was lifted but then a pre-award protest again stopped the process. 

The Centers for Medicare & Medicaid Services stated on November 4, 2014, that it hopes to resolve the issues and get things moving by this summer.

In the meantime, we are seeing another troublesome trend. RAC contractors have reached out to health insurance plans and contracted with them to conduct RAC-type reviews on their claims. It appears that notices are going out without a clear message and are confusing providers.

Read any RAC notice very carefully — this is important! If information is requested, that means you are beginning the medical review process. You must respond to these requests and completely and in a timely manner.

Always remember that all MDSs that affect a claim request need to be sent, and supportive documentation for the MDS also needs to be sent.  Always read the fine print in the request to make sure you are sending all necessary information. 

We still recommend that you get expert assistance in providing these responses. Also, if it is a Medicare Advantage resident and you have preauthorization for that stay in your facility, you need to copy that documentation. Many facilities have felt that a preauthorization means their claims cannot be denied. That is not always true. Those authorizations can help if you go into medical review. 

If you have unusual requests, contact your state association to see if others have similar issues. Some associations are working with the insurance providers.  Above all, make sure you have good processes in place.