Recovery Audits Cease as CMS Introduces New Provider-Friendly Contract Terms

24 February 2014 Health Care Law Today Blog

February is the last date Recovery Audit Contractors (RACs) and Medicare Administrative Contractors (MACs) can issue additional documentation requests (ADRs) as the current Recovery Audit Program contracts are coming to a close. This will give providers a much-needed “intermission” in recovery audits until the Centers for Medicare and Medicaid Services (CMS) finalize and select winning bidders for the next round of contracts. The new RAC and MAC contracts will introduce some much-desired changes to the Recovery Audit Program.

As CMS prepares to receive bids on the new contracts, the current RACs and MACs must discontinue new audits in order to complete the outstanding claim reviews by the end date of their current contracts.

  •          February 21 is the last day a RAC can send a postpayment ADR.
  •          February 28 is the last day a MAC can send a prepayment ADR for the Recovery Auditor Prepayment Review Demonstration.
  •          June 1 is the last day a RAC can send improper payment files to the MACs for adjustment.

In addition to giving providers a breather, this pause in audit operations will also allow CMS to make changes to the Recovery Audit Program, such as new limits on ADRs and specific time frames for audit review.

Changes to the Recovery Audit Program

The terms of the new Recovery Audit Program contracts are important because they dictate the manner (and limits) in which RACs and MACs can go about auditing and requesting records from providers. Here are some notable changes:

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