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June 2011

Savvy Coder: Coding & Reimbursement
Keep Your Practice Out of Hot Water: A Heads-Up About the RAC Program
By Sue Vicchrilli, COT, OCS, Academy Coding Executive
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UPDATE: RAC resubmissions may be through the RAC (as stated in the June EyeNet), but also can be through the Medicare administrative contractors (MAC) carrier.

(PDF 71 KB)

What’s bubbling up in the government’s alphabet soup of audits? In addition to the more traditional ingredients—such as CERT, FMR and OIG1—you may start seeing a dash of RAC.

What Is the RAC Program?

The goal of the Recovery Audit Contractor (RAC) program is to identify improper Medicare payments. Although that includes underpayments, you won’t be surprised to learn that auditors focus on correcting overpayments.

What do auditors review? There are two types of RAC audit—in one, auditors review the claims submission errors but not the physicians’ actual chart notes; in the other, auditors request documentation to investigate. Academy and AAOE members have reported being subject to the first type of audit.

What’s an audit’s time frame? RAC audits can’t go back further than three years of information, which means an audit that takes place today can’t pertain to claims data prior to 2008.

What’s the time frame for resubmitting claims? The time frame for resubmission is three years. RAC audits are not subject to the 12-month timely filing deadlines. Your practice may resubmit corrected claims, but you can only do so through the RAC resubmission process, not through the Medicare Part B process.


Potential Targets: 7 Billing Practices

Although ophthalmology hasn’t been a target of aggressive RAC audits, an increasing number of ophthalmology practices have reported to the Academy that they have been contacted about potential overpayments in the following situations.

New patient exam code. Billing a new patient exam code when the patient was actually an established patient of the practice. (The physician should not bill new patient exam codes on the same beneficiary within a three-year period of time.)

Modifier –25. Appending modifier –25, indicating a separately identifiable exam performed the same day as a minor procedure, when it should have been modifier –24, indicating the exam was unrelated to a global period.

Modifier –26. Appending modifier –26 and incorrectly being paid twice for the professional component of a test. (This may happen when physicians are already being paid globally for the technical and professional components of a test, and therefore –26 should not be appended when the physician provides the interpretation and report.)

Modifier –57. Failing to append modifier –57 to an exam, thus failing to indicate that the office visit took place to determine the need for a major surgery. (Exam services without modifier –57 should not have been paid.)

Modifier –59. Incorrectly using modifier –59, which indicates a distinct procedural service, to unbundle a Correct Coding Initiative Column 2 code from a Column 1 code. For example, submitting CPT code 66984, Cataract extraction with IOL, with code 65772–59, Limbal relaxing incision for surgically induced astigmatism, when the LRI is for correction of a natural astigmatism, in which case the patient should be responsible for payment.

Bilateral tests. Billing an inherently bilateral test with two units (indicating bilateral performance) when only one unit should have been submitted.

Duplicate claims. Submitting—and getting paid for—the same claim more than once. Cataract removal, to choose one obvious example, can only occur once per eye for the same date of service.


Auditors Share Their Findings

It is noteworthy that findings from the CERT audits—which identify billing patterns that may indicate fraud—are shared with the bodies conducting RAC audits.

1 CERT: Comprehensive Error Testing; FMR: Focused Medial Review; OIG: Office of Inspector General.


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