RAC Update for 2017

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Start Time:12:00 AM
End Time:12:00 AM
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Provided by MHA Center for Education

Date & Time

Wednesday, April 12, 2017
10 - 11:30 a.m.


CFOs, chief compliance officers, health care auditors, health care compliance staff, chargemaster coordinators, billing and claims generation staff, patient financial management staff, cost accounting staff, cost report staff, financial analysts, managed care contract staff, revenue enhancement staff, financial planners, clinic managers/administrators utilization review staff, medical staff organization staff, physicians, non-physician practitioners

The following program content was provided by the speaker.


This webinar will review the current status of Recovery Audit Contractor activities, including the new contracts, scope of work and various RAC-approved issues. Recent events surrounding RACs and the backlog of appeals at the administrative law judge and Medicare appeals council level also will be discussed. The Office of Medicare Hearings and Appeals has indicated that at least two years will be necessary to address current appeals, and has proposed different ways to handle the backlog, including statistical extrapolation, settlement conferences and administrative agreements. We’ll address these proposals, in addition to the “Over 2-Midnights” rule, and more.


  • review current RAC activities
  • review the different SOWs for the five regions
  • review the overall RAC appeals process
  • understand the role of the administrative law judges and the Medicare appeals council
  • discuss the enormous backlog of appeals at the ALJ/MAC level
  • review CMS proposed changes in the appeals process
  • assess the impact of the backlog both operationally and financially
  • review how OMHA is reacting to this situation
  • discuss one of the main issues causing the backlog – hospital inpatient admissions versus observation services
  • review the settlement process and administrative agreements
  • discuss the OMHA proposal to use statistical extrapolation
  • review the ‘Over 2-Midnights’ rule and the sub-regulatory guidance being issued including QIO involvement
  • appreciate common physician hospital services and associated billing
  • delineate current and anticipated physician issues
  • review current and anticipated hospital issues


  • Overview
    • Objectives of the RAC Program
    • Objectives of Other Federal Auditing Programs
    • Emphasis on Hospital Recoupment
    • Growing Number of Issues for Physicians/Clinics
    • Common Issues for Physicians and Hospitals
  • New RACs and Associated SOWs
    • Five New RACs
    • Guidance from the SOWs
    • Possible Differences in Prioritization of Issues
  • RAC Appeals Process
    • ALJs – Administrative Law Judges
    • MAC – Medicare Appeals Council
    • Specific Timelines Within the Appeals Process
    • How are Recoupments Handled?
  • Current Backlog of Appeals at the ALJ/MAC Level
    • Number of Appeals
    • Rate of Appeals Reaching the ALJ/MAC Level
    • General Categories of Appeals
    • OMHA’s Reactions and Operational Plans
  • CMS Proposed Changes to the Appeals Process
    • Increased Use of Attorneys
    • Streamlining Processes
  • Major Concern for RAC Denials of Inpatient Admissions
    • What Constitutes and Inpatient Admission?
    • How Inpatient Is Different From Observation
    • The ‘Over 2-Midnights’ Rule
  • OMHA Proposals to Resolve Backlog
    • Statistical Extrapolation
    • Administrative Agreements
    • Settlement Conferences
  • Trends in RAC Audit Issues
    • Physicians
    • Hospitals
    • Crossover Issues for Hospitals and Physicians
  • Additional Special Issues
    • re-Payment Audits
    • Issues Involving Statistical Extrapolation
    • CMS Improvements in the RAC Process
  • Sources for Additional Information


Duane C. Abbey
Abbey & Abbey Consultants, Inc.
Ames, Iowa

Duane Abbey is a management consultant and president of Abbey & Abbey Consultants, Inc., based in Ames, Iowa. For more than 20 years, Abbey & Abbey Consultants, Inc., has provided health care consulting services to hospitals, hospital systems, physicians, medical clinics and integrated delivery systems. In addition to consulting, Abbey has been an invited presenter for hospital associations, medical societies and other groups. He also has published articles and books on health care topics. Abbey earned his graduate degrees from the University of Notre Dame, in South Bend, Indiana, and Iowa State University, in Ames.