Did RAC ADR Limits Just Change?
Last Updated on Wednesday, 23 February 2011 01:07 Written by racroundup Wednesday, 23 February 2011 01:07
And is this Good News, Bad News, or Both?
Additional Documentation Request (ADR) limits for the Recovery Audit Contractor program have now been set by The Centers for Medicare and Medicaid Services (CMS) for all Medicare providers, including a change to the limit of the number of additional documentation requests a RAC can make per 45 day period from any hospital or other type of facility. Basically, the RACs use the same rule as last year, but an additional paragraph set a discreet cap for all facilities. However, we’ve received word that a hospital in Region A just got a letter from their RAC stating that their cap was raised to 500 records per 45 day period. The letter apparently says that CMS has determined that facilities with DRG payments in excess of $100M for the last fiscal year has [sic] the ability to address a larger number of additional documental requests.
FY2011 ADR Limits for Facilities
All the caps or limitations are defined by rules established by CMS for Institutions (facilities), physician and non-physician practitioners, and for Durable Medical Equipment (DME) suppliers. Each rule is available via separate PDF files on the CMS RAC Updates page.
The following three stipulations mirror the FY2010 rules for institutions:
- Limits will be set at 1% of all claims submitted for the previous calendar year, divided into eight periods (45 days).
- While respecting a provider’s overall limit, the RAC may exercise discretion in the exact composition of an additional documentation request. For example, the RAC may request inpatient records up to the full limit even though the provider’s inpatient business may only be a small portion of their total claim volume.
A final stipulation states that RACs can exceed the cap in cases where either CMS or the RAC has a reason to exceed it and CMS approves the increase:
- In addition, CMS may give the RACs permission to exceed the cap. Permission to exceed the cap must receive CMS approval and may occur by CMS or by the RAC requesting permission to exceed the cap. Affected providers will be notified in writing.
Just before that is a stipulation not seen in the previous year’s rules, setting a discreet cap, providing a significant decrease in the cap for larger hospitals:
- Beginning November 2, 2010, the cap will be 300 additional documentation requests per 45 days for all providers (excluding physicians and suppliers). [emphasis added]
How to Interpret the Rule and the letter?
So we have now two conclusions:
- The ultimate cap for facilities is 300 ADRs.
- A new cap can override that one, however, if a facility has payments from Medicare in excess of $100 million for the previous fiscal year?
CMS released a statement in response to questions from RAC Monitor about this issue, stating that they have only chosen to override the 300 cap in a few specific cases, to date.