1. Best Practice RAC Preparation
May 15, 2013
Jeremy Rittierodt, MSN, RN, CCM, CTT+
Account Executive, MCG
Greg Borden, RN
Senior Systems Analyst, Sarasota Memorial
Colleen Ryan
Manager of Integrated Case Management, Sarasota Memorial
Diane Settle, CPA, CHFP
Executive Director of Revenue Cycle, Sarasota Memorial

2. Overview
The RAC program was created through the Medicare Modernization Act (MMA) of 2003 to identify inappropriate payments and recoup overpayments under parts A and B of Medicare
RAC reviews are retrospective, with a look-back period of three years
Congress made the RAC program permanent in 2010, extending it to all 50 states

3. Impact on Hospitals
RACs made medical record requests associated with $6.4 billion in Medicare payments in 2012
Hospitals reported nearly $1.3 billion in automated and complex denials from RACs in 2012
The average value of an automated denial was $734; the average value of a complex denial was $5,358
During Q4 2012, 43% of all hospitals reported spending more than $25,000 managing the RAC process; 13% spent more than $100,000
Source: AHA RACTRAC Survey, 4th Quarter 2012

4. Medical Necessity Denials with the Largest Financial Impact
MS-DRG
Description
Percent of Hospitals
247
PERC CARDIOVASC PROC W DRUG-ELUTING STENT W/O MCC
21%
312
SYNCOPE & COLLAPSE
14%
392
ESOPHAGITIS, GASTROENT & MISC DIGEST DISORDERS W/O MCC
13%
313
CHEST PAIN
491
BACK & NECK PROC EXC SPINAL FUSION W/O CC/MCC 5%
Source: AHA RACTRAC Survey, 4th Quarter 2012

5. Establishing Medical Necessity: Syncope

6. Best Practice RAC Preparation
Completely and Accurately Document All Clinical Decisions
Measure Patient Progress Against Optimal Care Pathways
Track and Report on Variances from Optimal Care
Identify and Prepare for the Issues RACs Are Targeting
Respond Promptly to RAC Demand Letters
Place Case Managers in the Emergency Department, Seven Days A Week
Use Internal Audits to Prepare for RAC Audits

7. Completely and Accurately Document All Clinical Decisions
Inpatient admissions and extended stays
Changes in level of care (e.g., observation to inpatient)
Surgery and other procedures
Care planning

8. Measure Patient Progress Against Optimal Care Pathways
Identify the optimal care pathway for each patient
Make sure everyone on the care team understands the care plan
Document the medical necessity of every decision along the pathway

9. Track and Report on Variances from Optimal Care
What are the variances?
Medically necessary
Potentially avoidable
Favorable
Where are the variances?
How should we respond to them?

10. Identify and Prepare for Issues RACs Are Targeting
Short stays
Interventional cardiology
Syncope
Gastroenteritis
Chest pain
Joint and spine surgery

11. Respond Promptly to RAC Demand Letters
Put a RAC team in place
Know the response deadlines
Centralize the receipt and management of demand letters
Only appeal denials that make sense
Winnable appeals
Appeals worth the investment of time and money

12. Place Case Managers in the Emergency Department, Seven Days a Week
Determine a strategy for case management in the ED (24 hours a day versus peak hours)
Make sure case managers engage with providers
Consider the role of case managers in other areas of the hospital system

13. Use Internal Audits to Prepare for RAC Audits
Identify areas RACs are targeting
Review documentation in those areas
Put on your RAC hat
Look at variances and opportunities for improvement
Promote ongoing communication between appeals and case management staff

14. Sarasota Memorial
Sarasota memorial Health Care System, an 806-bed regional medical center, is among the largest public health systems in Florida
Founded in 1925, the system has about 4,000 staff, 802 physicians, and 1,000 volunteers

15. Structure of Sarasota Memorial’s Case Management Program
Original case management model
Design and adoption of Triad Model
Design process
Structure of Triad Model
How Triad interacts with other departments
Benefits and drawbacks of Triad Model

16. How Sarasota Memorial Prevents and Appeals RAC Denials
Prevention
RAC committee – members
Identified issues
Appeals
Medical necessity team
Review/appeal process

17. Role of MCG Products in Integrated Case Management and RAC Defense
Admission review

18. Impact of Integrated Case Management Program on RAC Denials and Appeals
Demonstration period
Volume
Success rate
Permanent RAC program
Success rate – % still in appeal

19. Performance Prior to Integrated Case Management
Sarasota Memorial contracted with Milliman to:
Review 100 cases for medical necessity against admission and continued stay criteria
Review the current utilization process
Design a case management/physician advisor process
Instituted an electronic case management tool to track:
Medical necessity
Delay days/delay rates
Denials

20. Performance After the Introduction of Integrated Case Management
Current review processes
Delay rates
Physician advisor rates
Denial tracking

21. Questions Jeremy Rittierodt jeremy.rittierodt@careguidelines.com
Greg Borden
Colleen Ryan
Diane Settle