Payment Automation Network, Inc.

Medicare RAC Baseline Audit Service Frequently Asked Questions

  1. What is RAC?
  2. How does it affect me?
  3. Can you help me understand the motivation for why a medical provider would want a third party to conduct this audit? With all the physicians to audit, won't it take a long time to reach everyone?
  4. So why pay someone to do the audit?
  5. How often should I have a Medicare RAC Base Line Audit done?
  6. If a physician has our Medicare RAC Base Line Audit Service done, will they still be subject to an additional audit form Medicare?
  7. If a practice has a high volume of claims should we do more than 50 files?
  8. Medicare RAC Auditors are not scheduled for my state until later in the year; do I wait to start the process?
  9. How does your service work?
  10. How much does your Medicare RAC Audit Service cost?
  11. How do I get started?

What is RAC?
The RAC(s)-Recovery Audit Contractors will pursue the identification of Medicare claims which contain non-MSP improper payments for which payment was made or should have been made under part A or B of title XVIII of the Social Security Act.

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How does it affect me?
Medicare has contracted for 2009 and beyond to audit every provider in the nation and Puerto Rico who files with Medicare. It is expected to be fully in place by 2010 on a permanent basis. The purpose is to identify incorrectly billed claims that are overcharging Medicare. Based on findings, if compliance to Medicare billing rules is not up to standard, penalties may be assessed including fines and in severe cases, the loss of Medicare billing privileges.

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Can you help me understand the motivation for why a medical provider would want a third party to conduct this audit? With all the physicians to audit, won't it take a long time to reach everyone?
Medicare will not provide any guidance to the physician or provider of care outside of giving them written guidelines. Our experience has shown that 95% of the providers won’t take the time to review. The RAC companies or contracts are paid on a contingency based fee, so they have every incentive to find incorrectly paid claims which is directly tied to the documentation on the record.

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So why pay someone to do the audit?
Medicare will not provide any guidance to the physician or provider of care outside of giving them written guidelines. By performing a Base Line Audit the provider receives a a Third Party Analysis of findings and recommendations and needed corrective action.

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How often should I have a Medicare RAC base line audit done?
We recommend the Medicare RAC Base Line Audit be performed yearly.

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If a physician has our Medicare RAC Base Line Audit Service done, will they still be subject to an additional audit from Medicare?
Yes, this does not prevent the RAC auditor from performing their own government sponsored audit, but it will give you time to review and adjust your billing practices and coding to be compliant.

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If a practice has a high volume of claims should we do more than 50 files?
For the Base Line Audit 50 files should be sufficient to determine if there is a major problem.

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Medicare RAC Auditors are not scheduled for my state until later in the year; do I wait to start the process?
The schedule for the rollout can be found at:   http://www.cms.hhs.gov/rac.

Providers should not wait for the RAC to come into the office before doing the Base Line Audit. The purpose of the Base Line Audit is to prepare the physician for any internal changes to either documentation or coding he/she may need to make. CMS will have specific range of dates of service they will be targeting. Our role is to identify areas of non-compliance and give you time to make corrective action.

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How does your service work?
We will provide you with a list of codes to pull files from. Your office staff can fax the information requested to our secure HIPAA compliant fax line (or we can come to your office and provide this service for you, at your convenience at no additional charge). Our auditors will analyze the files and generate a report within 7-10 days. We will then contact you and set a time to go over the report with you and consult with you as to any corrections that may need to be made.

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How much does the Medicare RAC Base Line Audit Service cost?
Our service cost only $995 per Audit and will be completed in a few days.

  • We perform a 50 patient chart random base-line audit
  • Done by certified coding auditors
  • Evaluation & Management (E&M) done by specialty
  • Documentation compliance rules for all levels of service
  • Correct diagnosis coding by specialties 
  • Medical necessity expertise
  • In 7-10 days you will receive a detailed compliance summary on our findings with recommendations to bring your documentation into Medicare compliance immediately
  • It will allow your practice time to make changes before Medicare Auditors come to your door.

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How do I get started?
Call toll free (800) 813-3740 x 1 or click here to contact a representative by email.

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