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Recovery Audits Targeted by House Bill, AHA Suit

James Carroll, for HealthLeaders Media, November 9, 2012

Recover auditors are under fire.

On October 16, Representative Sam Graves (R-MO) introduced a bill that essentially aims to reform Recovery Auditors (RA) through various financial penalties and program limitations.

Two weeks later, the American Hospital Association and four health system filed suit in the U.S. District Court in Washington, DC, against the U.S. Department of Health and Human Services (HHS) for unfair Medicare practices pertaining to the Recovery Auditor program.

The plaintiffs, which include Missouri Baptist Sullivan Hospital (Sullivan, MO), Munson Medical Center (Traverse City, MI), Lancaster General Hospital (Lancaster, PA), and Trinity Health Corporation (Livonia, MI) claim that the Medicare program has been "refusing to pay hospitals for hundreds of millions of dollars' worth of care provided to patients, even though all agree that the care provided was reasonable and medically necessary as the Medicare Act requires."

They further allege that the government's refusal to pay is harming hospitals and patients, violates the Medicare Act, and is unlawful. They want the court to overrule HHS' policy and order the department to reimburse hospitals that have been denied payment.

Facilities need to constantly balance quality of care and financial concerns when dealing with Recovery Auditors, suggests Jonathan G. Wiik, director of admissions and case management at Boulder Community Hospital in Boulder, CO.

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