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New RAC Document Requests on Hold

The Centers for Medicare & Medicaid Services (CMS) announced Feb. 18 that as of Feb. 21, hospitals will not receive new postpayment additional documentation requests (ADRs)  from recovery audit contractors (RACs) until the next round of RAC contracts are awarded. This will allow RACs to wind down current contracts and complete all outstanding claim reviews by the contracts’ end date. Current RAC contracts were set to expire in February, and CMS announced in January that they would be “extended [by] several months.” CMS has not announced when it expects to finalize new contracts.

In addition, CMS announced changes to the RAC program that will take effect under new RAC contracts:

  • RACs must wait 30 days before sending a claim to a Medicare audit contractor (MAC) for adjustment.
  • RACs must confirm they received a provider’s request for discussing a decision within three days of receiving the request.
  • RACs must wait to receive their contingency fee “until the second level of appeal is exhausted.”
  • Revised ADR limits will be established for different types of claims such as inpatient or outpatient.
  • RACs will adjust ADR limits based on a provider’s denial rate. Providers with lower denial rates will have lower ADR limits.

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