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Limiting Your RAC Visibility and Financial Risk

Limiting Your RAC Visibility and Financial Risk. Joel Lipin, MD, MPH Managing Director, Reimbursement Services. Who We Are. Sinaiko Healthcare Consulting is a leading healthcare management consulting firm, assisting clients with mission critical assignments nationwide.

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Limiting Your RAC Visibility and Financial Risk

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  1. Limiting Your RAC Visibility and Financial Risk Joel Lipin, MD, MPHManaging Director, Reimbursement Services © 2008 Sinaiko Healthcare Consulting, Inc. Proprietary and Confidential

  2. Who We Are Sinaiko Healthcare Consulting is a leading healthcare management consulting firm, assisting clients with mission critical assignments nationwide. • Founded in 1990 by Richard Sinaiko • Serve integrated health systems, academic medical centers, medical groups, community hospitals, ancillary service providers, health plans and payors, with a particular emphasis on the provider side of the industry • National practice; performed work in over 35 states and 2 foreign countries © 2008 Sinaiko Healthcare Consulting, Inc. Proprietary and Confidential

  3. Sinaiko Service Lines Coding Support, Audits and Education CDM Assessment/Strategic Planning RAC Audit Preparedness © 2008 Sinaiko Healthcare Consulting, Inc. Proprietary and Confidential

  4. Recovery Audit Contractor (RAC) Background • RAC “Recovery Audit Contractor” • CMS implemented RAC Demonstration in 2007 (CA, FL, NY) • $693.6M was returned to CMS during demonstration phase • RAC roll out to all 50 states by January, 2010 • Program Objectives • To reduce Medicare Part A & B Improper Payments • Detection and reporting of overpayment to providers and CMS • Identification of underpayments from Medicare • Targets: Inpatient/Outpatient Hospitals, SNFs, Physicians, DME suppliers and Laboratories © 2008 Sinaiko Healthcare Consulting, Inc. Proprietary and Confidential

  5. RAC Post Payment Audit Approximately 96% of improper payments were over-payments and 4% were under payments. • 85% of improper payments were collected from inpatient hospital providers • 6% of improper payments were collected from Inpatient Rehabilitation Facilities (IRF) • 4% collected from outpatient hospital providers © 2008 Sinaiko Healthcare Consulting, Inc. Proprietary and Confidential

  6. What We Know RAC audits are primarily focusing on: • Duplicate payments • Medical Necessity • Clinical demonstration • Coding demonstration • Place of service • Coding Errors (e.g. MS-DRG, CPT, ICD-9) © 2008 Sinaiko Healthcare Consulting, Inc. Proprietary and Confidential

  7. What You Need To Know • Automated RAC Review – Determination • Complex RAC Review – Request for Records • How to avoid recoupment of dollars when you appeal an overpayment determination • Strict Deadlines © 2008 Sinaiko Healthcare Consulting, Inc. Proprietary and Confidential

  8. How Sinaiko Can Help • Phase I – Analysis and Results Identification • Phase II – Response and Implementation Education and Implementation • Phase III – Denials Management Process Assessment Preparation © 2008 Sinaiko Healthcare Consulting, Inc. Proprietary and Confidential

  9. Phase I – Analysis and Results • Analysis of data to identify outlier risk • Audit minimum of 50 records • Prepare detailed audit spreadsheet and/or narrative report summary © 2008 Sinaiko Healthcare Consulting, Inc. Proprietary and Confidential

  10. Phase II* – Response and Implementation • Perform a front to back door assessment of the client’s HIM and/or coding department • Develop customized coding and CDI education presentation based on audit findings • Provide Charge Master/Fee Schedule Maintenance Policy Template *Sinaiko also offers an ala carte Phase II Option with expanded audit services, onsite training and implementation support. © 2008 Sinaiko Healthcare Consulting, Inc. Proprietary and Confidential

  11. Phase III – Denials Management Process Assessment • Review all supporting Denials Management/Appeals Policies and pertinent tracking and outcome reports • Perform an onsite assessment of denial processes from the notification of the denial through the tracking of the appeal outcome • Prepare a narrative report of all activities, interactions, findings and further recommendations © 2008 Sinaiko Healthcare Consulting, Inc. Proprietary and Confidential

  12. Final Thoughts “According to CMS, improving self-auditing programs may be the best defense against the RAC program”. - Modern Healthcare (November 2008) Jennifer Lubell, Crain Communications © 2008 Sinaiko Healthcare Consulting, Inc. Proprietary and Confidential

  13. Contact Information • Joel W. Lipin joel.lipin@sinaiko.com (310) 791-8505 • Richard E. Sinaiko richard@sinaiko.com (310) 551-5252 • Jeffrey E. Sinaiko jeff@sinaiko.com (310) 551-5252 © 2008 Sinaiko Healthcare Consulting, Inc. Proprietary and Confidential

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