RAC Audits: If It Walks Like a Duck and Quacks Like a Duck…

Today, I want to talk about secret, hidden RAC audits. As you are probably aware, federal regulations limit RACs from going back more than three years to audit claims.

Juxtapose this with the Unified Program Integrity Contractors (UPICs), Targeted Probe-and-Educate (TPE), Supplemental Medical Review Contractors (SMRCs), Medicare Administrative Contractors (MACs), U.S. Department of Health and Human Services (HHS) Office of Inspector General (OIG), and even state Medicaid agencies. Everyone but the RACs is allowed more than a three-year lookback period. Some, like the OIG, have quite long lookback periods.

Coincidentally, when a company responds to a request for proposal (RFP) from the Centers for Medicare & Medicaid Services (CMS) to act as CMS’s vendor to conduct Medicare audits on America’s Medicare providers, clauses in the proposed contract between CMS and the vendor are highly argued or negotiated. Which clause in the vendor’s contract is most negotiated? I will tell you: the clause that states that the vendor is designated as a RAC. Because if the vendor is called a UPIC instead of a RAC, it has a longer lookback period. Being called a UPIC suddenly becomes a commodity. There are no laws mandating UPICs to a three-year lookback period. All of a sudden, it is not hip to be a RAC.

Look into it. Do your research. The contracts are public records. Ask for Cotiviti’s contracts with CMS. (Notice I said contracts, not contract.) What I have realized over time is that a vendor may be hired by CMS to be a RAC auditor, but once the vendor realizes the limit of three years, it often goes back to CMS and asks if it can be considered an UPIC. Why? A UPIC can do everything that a RAC does; however, it gets an additional three years to look back at claims – and that means more money. Cha-ching! Even Dr. Ronald Hirsch commented today on RACmonitor about this story, which I presented this morning, as I present every Monday morning, live, on the national podcast Monitor Mondays, hosted by Chuck Buck and produced by MedLearnMedia. If you want to listen to the podcast, click the following link: Nelson Mullins – Monitor Mondays Podcast Featuring Knicole Emanuel; Defeating Statistical Extrapolations, Expansion of Medicaid RACs, IPPS Final Rule, Smart Hospitals, and Physician Advisors Episodes

The podcast is also on video, but I don’t know how to link to that. If you do, you would see my baby duck Biscuit on the screen. He joined me this morning to talk about how “What Walks Like a Duck and Quacks Like a Duck Must be a Duck.” Dr. Hirsch commented that companies like Cotiviti have many, many contracts, deeming Cotiviti many different acronyms. If you get a letter from Cotiviti, do not assume that it is acting as a RAC. Instead, ask for the contract allowing Cotiviti to do what it purports to want to do.

I’ve noticed this trend in real life, but only for 10-20 individual cases, maybe 30. I have not had the time to draft a Freedom of Information Act (FOIA) request, and quite frankly, my name on a FOIA request nowadays results in a response that says something to the effect of “use discovery instead.”

Even though my personal experiences should not be extrapolated across the country, because that would be inappropriate and judgmental, I will give an example – and you may extrapolate or not. There is a company that has been doing RAC audits in North Carolina for the last 5-8 years. It is called Public Consulting Group (PCG). PCG and I go way back.

If you are a longtime listener of Monitor Mondays, you will recall that Ed Roche and I presented numerous segments about the debacle in New Mexico in 2013. The State of New Mexico put 15 Medicaid providers, who constituted 87.6 percent of the behavioral health (BH) providers in the state at the time, out of business. The consequences were catastrophic; thousands were out of services overnight. There is even a documentary about the unraveling of behavioral health in New Mexico in 2013. The reason that these providers were put out of business was because of PCG. PCG issued a report to the state after conducting Medicaid audits on these facilities, accusing them of fraud. In 2013, PCG was considered a RAC, per contract. Today, when I have a case against PCG and make the three-year lookback period argument, I get a retort that it’s not a RAC. Instead, it’s a UPIC.

To which I say, if it walks like a duck and quacks like a duck, it is a duck.