Let's Help Each Other

Physical therapy is changing rapidly. As a PT with more than thirty years of experience, the changes observed in the last ten years triple those of the first twenty years. The pace of change is not slowing down. The Medigraph Blog will serve as a forum that will enable us to exchange ideas and assist each other. This blog will be used to share billing, documentation, and any other ideas to improve any aspects of our profession. If we share what we have learned, we can develop a resource that enables our collective understanding to advance our careers.

As profit margins grow smaller and expenses grow larger, we need to assist each other to survive and prosper. If we share our experiences we can help each other to grow professionally, administratively, and financially. Our professional lives, our livelihood, and our personal lives are intertwined. Our resources individually are limited. Together we can accomplish more than we can individually. Let's help each other


Tom Kane, PT
MediGraph Software

The Financial Costs of Appealing a RAC Audit
5/5/2011 11:34:00 AM
A recent article from the American Hospital Association (AHA) discussed the costs associated with appealing a RAC audit.  The AHA paper is quite revealing of how the RACs posses numerous advantages in extracting a refund from you (the only way a RAC get paid for their efforts).    One  of these advantages is that a RAC appeal costs between $2,000 and $7,000 dollars per claim (per individual patient audited).    The cost- benefits ratio of a RAC appeal becomes decidely less attractive for PT appeals because of  the costs.  Why?  If a RAC requests a $1,000 refund, would you be willing to spend between $2,000 to $7,000 to protest this refund?  Probably not.   Do not misinterpret my position.   I understand the arguments based on principle when a person believes thay are being penalized unjustly.   But from a business perspective, the decision to spend between $2,000 - $7,000 to prevent the RAC from capturing $1,000 is a losing proposition.

Regrettably, I must state that the RACs are not auditing records that are free from errors.  Frankly,  RACs do not have to fabricate their findings to obtain a refund.  Medical providers are creating plenty of opportunities for RACS.   When codes are not supported by proper documentation the RACs are emboldened.  There are limits to the RACs'''' authority, but these limits are primarily window dressing.  RACs are limited by the number of charts they can request per 45 day period.  For example a therapy practice with five or less therapist is limited to  auditing 10 charts every 45 days.   However, that 45 day period can be extended indefinitely.  Stated plainly, every 45 days the RAC auditor can request another 10 charts.  Unfortunately, the RACs can go back three years from the date of the audit and continuously request records.  (https://www.cms.gov/RAC/Downloads/PhyADR.pdf).

I implore my colleagues to pay attention to these warnings.  I will not repeat what we must do to prevent RAC audits.  Those suggestions have been presented on numerous occasions on this blog.  Consider this strategic view; if a RAC  reviews the claims you are now submitting, and your coding and documentation meet the current standards, the RACs are unlikely to request a 'Complex' review.  Avoiding a 'Complex' helps to deter the RAC from  reviewing your previous records because the RAC prefers to look for someone that has current documentation deficiencies.  Obviously, a person whose recent charts have deficiencies is more likely to have past discrepencies as well, which presents the RAC with the opportunity of capturing additional revenue from the fees that you were paid in the past.   Do not make yourself an easy target.  Use the MediGraph tools at your disposal to avoid the RAC trap.

Be well,
Tom Kane, PT
MediGraph Software