CMS Reports High Accuracy of RAC Audits


December 5, 2013                                                                

CONTACT: Kristin Walter
(202) 898-0995

CMS Reports High Accuracy of RAC Audits 

Finds average 95% accuracy rate across all auditors

Washington, DC – A report from the Centers for Medicare and Medicaid Services (CMS) to Congress entitled, Recovery Auditing in the Medicare and Medicaid Programs for Fiscal Year 2011 demonstrates the incredible accuracy of recovery auditors (RAs).  The CMS Recovery Audit Program – which reviews and corrects hospital billing errors – has successfully recovered more than $7 billion in improper Medicare payments since it began in 2009.

In the report, CMS states, “the Recovery Audit Program has proven to be a valuable tool to reduce improper payments.”  The report shares that all RACs are working at an accuracy rate above 90 percent – with some as high as 97 percent. The average accuracy rate across all auditors is 95.2 percent.

“The structure of CMS’s Recovery Audit Program ensures very accurate findings,” said Kristin Walter, spokesperson for the American Coalition for Healthcare Claims Integrity (ACHCI).  “Auditors are paid on a contingency fee basis – only receiving a percentage of the recovered costs – ensuring that RAs go to great lengths to report accurate findings. In fact, if a finding is overturned, the auditor must return their fee. Auditors, therefore, are motivated to work cautiously and respectfully to maintain a very low error rate.”

Recent complaints from the American Hospital Association (AHA) and the American Medical Association (AMA) state that audits are placing an unnecessary burden on providers. However, RAs are only auditing a mere 2 percent of all Medicare billings, and yet are finding errors in nearly 50 percent of those records. According to recent reports data, America’s hospitals are responsible for 88% of the overbillings to the Medicare program, which currently has an improper payment rate of nearly $30B each year.

“Providers are responsible for ensuring that they are delivering proper care to patients while fully complying with Medicare billing policies,” said Walter.  “RAs continue to work with hospitals and CMS to not only ensure proper payments for Medicare, but also to educate providers about how to enact appropriate controls, identify gaps in payment processes and avoid future Medicare billing issues.”

The national Recovery Audit Program was put in place by Congress to recover improper payments and reduce future incidents of Medicare waste, fraud and abuse throughout the country.

For more information, please visit: www.properpayments.com

To review the full CMS report, click here.

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About the American Coalition for Healthcare Claims Integrity

Founded in 2009, the American Coalition for Healthcare Claims Integrity (ACHCI) is a non-profit organization committed to working toward achieving 100% accuracy in payment claims submitted to public and private sector healthcare payors. The coalition’s mission is to educate policymakers and other stakeholders regarding the importance of healthcare integrity programs that help identify and correct improper payments.  ACHCI’s founding members are partners in critical accountability initiatives including the federal Recovery Audit Contractor (RAC), Zone Program Integrity Contractor (ZPIC), and Medicaid Integrity Contractor (MIC) programs.

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