House Bill Reins in RAC Abuses

U.S. Reps. Sam Graves (R-MO) and Adam Schiff (D-CA) have reintroduced the Medicare Audit Improvement Act, which would make changes in the Medicare Recovery Audit Contractor program.

The lawmakers first introduced the bill in October 2012 in the waning months of the last congressional session. The American Hospital Association and American Health Information Management Association support the measure to reduce burdens on providers.

According to a statement from Graves’ office, the bill “would reinstate and make statutory a hard cap on Additional Document Requests (ADRs) on the part of Medicare auditors to two percent of hospital claims with a maximum of 500 ADRs per 45 days.” Graves says the legislation will permit adequate oversight while ending an “open-ended invitation from CMS to continually bombard hospitals.”

The legislation also would authorize penalties on auditors not complying with program requirements, increase transparency of auditor activities, require physician review for Medicare denials, permit denied inpatient claims to be billed as outpatient when appropriate, and require medical necessity audits to focus on widespread payment errors, AHIMA notes.

Text of the new bill soon will be available at http://thomas.loc.gov.