RACs Recoupment Wrong, TMA Says

Medicare's effort to recoup improper payments to physicians through its Recovery Audit Contractor (RAC) program "is an enormous burden on the affected physicians and has failed to further the worthy goal of eradicating frequent billing mistakes."

So say TMA, AMA, and other medical societies in a letter to Centers for Medicare & Medicaid Services (CMS) Acting Director Charlene Frizzera. They said problems with over- and/or underpayments of Medicare claims "would be most effectively resolved through physician outreach and education."

Much of the concern centers on RACs reviewing evaluation and management (E&M) services. Such review is not appropriate because "the broad parameters for reporting E&M codes do not lend themselves to basic review," the letter said, adding that "despite detailed Medicare guidelines that specify the documentation required for each level of E&M service, knowledgeable individuals often reach different conclusions regarding the E&M level of service justified by the documentation. These problems are further exacerbated by the fact that the people performing the audits are not physicians of the same specialty and state as the physicians being audited."

Furthermore, the letter said that "auditing E&M services threatens to overburden physicians at a time when many specialties are in increasingly short supply and impending baby boomer retirements will exacerbate existing shortages. While audits of E&M services will create yet another unfunded mandate for all physicians, the burden will be particularly heavy for primary care physicians because nearly all primary care services fall into the E&M category and the majority of these practices are solo or small practices with little ability to deal with the administrative burden imposed by a RAC audit." Currently, almost 30 percent of patients seeking a new primary care physician have trouble finding one.

The groups concluded that the "best way to reduce common billing and coding mistakes is through targeted education and outreach, rather than onerous audits performed by outside contractors with incentives to deny claims. Thus far, we have been extremely disappointed by the focus on punitive measures instead of physician education and communication." 

More information about the RACs and their potential impact on Texas is available in the March issue of  Texas Medicine .

Action , March 2, 2009