Hospital Health Information Management Directors Comment on RAC Program

MINNEAPOLIS, Minn. — Ninety-two percent of hospital Health Information Management (HIM) directors are familiar with the Centers for Medicare and Medicaid Services (CMS) Recovery Audit Contractor (RAC) program, but few expect it to have a positive financial effect on their facility, according to an independent national survey completed last month on behalf of Wolters Kluwer Health. Of the HIM directors familiar with the RAC program, only 5 percent believe it will have a positive financial impact on their facility due to recovery of funds from Medicare underpayments. Rather, nearly nine in 10 (88 percent) either anticipate a negative financial impact, due to their facility owing funds for Medicare overpayments (40 percent), or anticipate their facility will come out about even (48 percent).

Of the total surveyed, the majority of the HIM directors (81 percent) report their facilities are taking steps to improve Medicare claims accuracy. Of this group, the majority report their hospital has:

• Conducted internal audits (77 percent).
• Implemented a documentation improvement plan (66 percent).
• And/or created a special task force to examine documentation, coding and billing (57 percent).

Thirty-three percent of this same group report their hospital has installed new software to capture correct documentation, coding and billing. HIM directors at medium-sized hospitals are most likely to report their facility has taken this step (47 percent), compared to 16 percent of those at small hospitals and 35 percent of those at large hospitals. Only 18 percent of the HIM directors taking steps to improve Medicare claims accuracy report their facility has hired additional coders.

“Hospitals face enormous challenges with the quality and accuracy of their clinical documentation, and the RAC findings confirm this issue. Many times the documentation is not sufficient to generate appropriate codes,” said Arvind Subramanian, president & CEO, Wolters Kluwer Health Clinical Solutions and ProVation® Medical.

“ProVation software was created specifically to address these issues,” he continued. “The ProVation system produces preliminary codes tied directly to complete supporting documentation and streamlines the coding and billing process for busy HIM professionals. This directly impacts RAC preparedness, allowing facilities to minimize their exposure without draining HIM resources.”

Renaissance Research, of Edwardsville, Ill., conducted the national survey by telephone interviews between June 30 and July 8. The interview was completed by 175 hospital HIM directors, providing a margin of error of +/- 7 percentage points.

Background on RAC Program
In 2003, Congress directed the Department of Health and Human Services (HHS) to conduct a three-year RAC demonstration to detect and correct improper payments in the Medicare Fee-For-Service program. In 2006, Congress directed HHS to make the RAC program permanent and nationwide no later than Jan. 1, 2010. The RAC demonstration was completed in March; a report of the findings can be found HERE.

Source: Wolters Kluwer Health