In a recent Modern Healthcare article, “RAC Appeals Backlog Cause for Frustration,” it is cited that HHS’ Office of Medicare Hearings and Appeals began notifying hospitals around the country with high numbers of appeals that they would not be able to submit new cases until the existing backlog clears – which could take two years or more. With an average of 15,000 appeals being submitted per week and over 70% of all appealed claims still sitting in the appeals process, it is no surprise that this RAC backlog is causing unrest in the healthcare community. This issue will only continue as RAC activity continues increasing at a significant rate. While this is definitely frustrating for hospitals, and negatively affects their cash flow, it is not quite as hopeless as it sounds. By improving their documentation, hospitals will be able to manage appeals through the earlier levels, before it even gets through to the level-three ALJ appeal. The following improvements to hospitals’ documentation and appeals will enable the real long-term answer to this problem:

• Implement management tools to help ensure important deadlines are not missed before you get to the third level of appeal, which requires an administrative law judge (ALJ).
• Learn from the appeal process. Review the entire claim, denial, and appeal to ensure that all issues related to the case can and will be prevented in the future.
• Have a system or process in place to track and monitor denials and appeals in order to prioritize the cases that are worth pursuing.
• Develop hospital-specific leveling criteria to define complex patients and/or complex procedures to delineate inpatient/outpatient status for grey area procedures.
• Self-audit to identify risks and internally track any and all RAC activity to minimize your financial risk.

What proactive RAC best practices have your hospital implemented to improve documentation and reduce appeals?