Frequently Asked Questions
What is a Medicare RAC audit?
A Medicare RAC (Recovery Audit Contractor) audit is a review conducted by independent contractors to identify and recover improper Medicare payments made to healthcare providers. These audits focus on overbilling, miscoded claims, and services that were not medically necessary.
Why is there controversy around RAC audits?
The controversy stems from the way RAC auditors are compensated. They earn a percentage of the overpayments they recover, which critics argue creates a conflict of interest and may incentivize aggressive or unfair audit practices.
What is the purpose of the RAC program?
The primary purpose of the RAC program is to protect Medicare funds by detecting and correcting improper payments. This helps CMS reduce error rates and ensures compliance with Medicare billing policies.
Can RAC audits be appealed?
Yes, providers have the right to appeal RAC audit findings. The appeals process includes multiple levels of review, and providers are encouraged to challenge inaccurate or unjustified findings with proper documentation and legal support.
How can providers avoid RAC audit issues?
To avoid issues, providers should stay up to date with CMS billing rules, conduct regular internal audits, and ensure accurate coding and documentation for all claims. Proactive compliance helps reduce the risk of red flags and potential audits.
