they don’t develop the expertise needed.”
Active education of case managers, cod-
ers and physicians doing the documenta-
tion is also important to ensure claims are
as clear and proper as possible to make it
easier for an audit to determine they are
appropriate, and for providers to more eas-
ily appeal when they are contested.
Also, while the issue of medical necessity comprises the bulk of complex audits, RACs also conduct diagnosis-related
group validation audits, to ensure medical
conditions are properly classified, and that
means coding training for nurses.
The biggest ongoing problem in audit
compliance for Ministry Health is keeping
the talent once the audit team has built expertise, Hegland counsels. An organization
has to make staying on the team attractive
as long as possible, while still offering opportunities for advancement. Having a
positive culture and doing little things, like
celebrating wins with a group lunch, are
important. “We don’t demonize RACs,” he
adds. “It’s hard to keep folks upbeat and
having positive energy if you view audit programs as being evil.”
Getting outside help
To manage its RAC work, Shore Medical
Center in Somers Point, N.J., uses software
and outsourced services from MRO Corp.,
which specializes in handling release of information functions.
Shore Medical received letters requesting
documentation for complex audit reviews
eight times in 2011 and five times in 2012,
along with a couple of automated reviews in
2012 that were not scheduled, says Richard
Wicker, health information management
The hospital got a reprieve from RAC audits in the fall after SuperStorm Sandy hit,
but Wicker got a stack of letters for new audits in mid-January, which he takes to mean
that the contractor did not reduce the number of audits it intends to conduct but just
held the letters for a while.
Splitting the work with MRO, the hospital
audit team opens requests for documenta-
tion, determines if they are valid, logs the
requests in a Web-based release of information system from the vendor, pulls records
to determine what information to release,
and scans or uploads documents for release
into the MRO system.
The hospital also uses audit tracking and
analysis software from the vendor to coordinate audit processes for multiple auditors,
organize provider tasks, process summa-ries, maintain requested documentation
and auditor correspondence, and analyze
trends and errors.
The vendor performs a series of quality
assurance checks to ensure appeals letters
are prioritized and deadlines met, verify
the correct requester and address, check
documents to ensure other files weren’t
mixed in, determine transmission method (electronic file or paper) and ship the
documents to the RAC, and track the shipments, among other duties.
Shore Medical also uses an outside firm
to audit medical coding for appropriate
DRGs. In addition to helping with especially challenging DRG denials, the firm
will handle appeals of billings with RAC-deemed inappropriately coded DRGs on
bills they have audited, and the firm will
pay the difference if the appeal is lost.
During the past three years, the hospital
has learned that there often are dispari-ties between what a physician dictates and
what shows up in clinical documentation,
Wicker believes the upcoming transition
to ICD- 10 code sets is a good opportunity
to address this issue by educating coders
and physicians on better documentation.
Like Shore Medical, CoxHealth in Missouri
also outsources some RAC work, but not
a lot. With one exception, all the work is
done in the audit and compliance department, says director Carol Conley.
The consultant firm Executive Health
Resources reviews inpatient hospital stays
to determine if the billing is appropriate at
the time of service and before claim sub-
mission. The firm also appeals accounts
they previously reviewed and deemed
as appropriate for inpatient status. For
other accounts not reviewed by Execu-
tive Health Recourses, CoxHealth decides
whether to appeal.
Third level’s a charm
Once CoxHealth gets before an administrative law judge in the third level of appeal, it so far has a 100 percent win rate on
a limited number of appeals presented,
CoxHealth recently implemented audit
management software from Craneware,
which offers more tracking and analysis
features and better workflow tools than
the software the health system previously
used, Conley says.
A critical new function is that CoxHealth
can track and analyze decisions of administrative law judges to understand their
When presenting appeals before administrative law judges, providers may
get as little as five minutes to make their
argument. The case is entirely focused on
whether a regulation was followed. Consequently, providers have to make sure they
have reference information readily available to the judge, such as the page number
where proof of compliance is documented,
She offers another appeals tip: Involve
physicians, who provide excellent rationale for the medical necessity of an inpatient admission.
Depending on the judge, a provider may
present its first case and the judge may ask
if the argument on the others is the same.
If so, the judge will hear the other side and
then make a decision on the batch billings