RAC Audit Insurance: Medicare To Expand Audits Increasing Need For Coverage

The Health Care and Education Reconciliation Act of 2010, also known as the Affordable Care Act, expanded the Recovery Audit Contractor Program to include parts C and D of Medicare coverage. The expansion of the program has increased the number of companies that need RAC audit insurance to cover them in case of a review of their billing is required. The program was established by lawmakers to recover overpayments that were paid by the government to medical care providers.

Background Of Medicare+Choice Program

Medicare was originally put into place to provide retirees with needed medical coverage into their old age. With the establishment of M+C in 1997, those with the coverage were able to choose whether to stick with the original policy in place, or to elect to go with the M+C policy. In 2003, the Medicare Prescription Drug, Improvement, and Modernization Act amendments added coverage for needed medicines. The implementation also revised the name of M+C to the Medicare Advantage and made several revisions to make it more efficient.

Establishment Of Recovery Audit Contractors

One of the biggest changes in 2003 was the establishment of RACs that were used to identify situations where overpayments had been made to medical care providers. In 2005, demonstration reviews were completed to determine if medical care providers had received too much through the program in six states including New York, California and Florida. Based upon the analysis, they determined that more than $900 million in excess had been paid out in those states over a three year period. The program was to be rolled out in all states by the beginning of 2010, but was completed by the end of October 2009. The contractors are paid based upon the amount of money that they recover, so their goal is to find every shred of excess. RAC audit insurance, or physicians' regulatory insurance, was developed to protect medical providers from suffering significant losses due to the determinations of the contractors. The coverage allows physicians to conduct business normally, and take on patients without concern of debilitating losses from the audits.

Expansion To Parts C And D

The Centers for Medicare and Medicaid is currently conducting an investigation to determine how the audits should best be completed for parts C and D providers as well. Based on a communication that was dated December 8, 2010, the organization is seeking comment from providers to determine how to put an effective plan in place. They are discovering how these types of audits are used in the commercial market for managed care, and how to implement a place for that and prescription drug benefits as well. With the expansion of the investigations, more companies will need to seek physicians' regulatory insurance to protect their companies from a potential loss.

RAC Audit Insurance Coverage

Any company in the medical field that receives funding through Medicare plans is at risk to these reviews. While it is true that contractors also review underpayments, how much they are paid is determined by how much money they are able to recover. Ensure your company is protected by getting RAC audit insurance today.