From HFMA: Preparing for a RAC Audit

Michelle Pointe, for HealthLeaders Media , June 18, 2009

With the RAC demonstration ended, one of the best ways to prepare for a RAC audit comes in learning from survivors. Elizabeth Lamkin, CEO of Hilton Head Regional Hospital in South Carolina, offered key guidance to HFMA conference attendees in how to ready their organizations for a RAC attack. As you can imagine, the discussion was lively and overtaken by questions from the audience, who were eagerly ingesting as much information as possible.

As part of the RAC demonstration, Hilton Head Regional, a Tenet Healthcare hospital, was indeed audited and went through an appeals process, which Lamkin says, was very successful but very painful. "We are under a corporate integrity agreement, which does change your mindset," she says. "You get into the eyes of the government and once you do that you will need therapy."

During the audit, Lamkin says the hospital was very detailed in its record keeping. "We kept a copy of everything we sent. We also reviewed every chart for compliance with our physician advisor, and were confident we had medical necessity so we appealed," she says.

On the 31 charts involved in the audit, Lamkin says the hospital received 22 back saying they had been denied. "On the rest they didn't respond so we had to assume we were right. They were bounty hunters. They want your scalp," she says.

The biggest piece of advice she imparts is to know that you will get a RAC audit and to put systems in place today. "We were very focused on one-day stays, which is where the RAC auditors were looking," says Lamkin. "You engage your physicians and your staff. We always believed in a strong culture of accountability. One way to make people accountable is to audit, inspect, and correct. If processes are not in place you can't win an appeal."

In preparing for the RAC onslaught, Lamkin says it is essential for hospitals to have the right physician advisor in place to monitor medical necessity cases. At Hilton Head Regional, the chief of staff works part time as a physician advisor. "If done correctly, a physician advisor will be your saving grace," says Lamkin. "If the patient does not meet medical necessity, the call goes to the physician advisor, so it means your case managers and that doctor have to get along."

The hospital also started using a call center two years ago to advise physicians on the proper bed status of patients presenting in the emergency room. The hospital also does real-time billing audits and compliance checks on the front end.

Michelle Ponte

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