RAC attack program seeks hidden problems
The philosophy behind the RAC program at Palomar Pomerado Health (PPH), based in Escondido, CA, is that it is better to find problems yourself before an auditor finds them for you.
Tom Boyle, director of internal audit at PPH, says the hospital's RAC committee seeks to ensure the best possible billing, coding, and documentation, while at the same time looking for any potential signs of trouble. The committee includes representatives from managed care, revenue cycle, IT, nursing, case management, patient business services, decision support, audit, and compliance; plus others are brought in as needed from areas such as radiology, imaging, or laboratory.
"We set up parameters for what we consider normal or expected transactions and look for those anomalies that need investigation," he says. "The RAC audits can be a scary thing to anticipate because of the financial situation in health care right now. It adds to the list of burdens and pressures on us already, because we already had a big increase in self-pay and no-pay accounts, which I think is a trend as people are losing their jobs and their health care."
Boyle offers this example of the kind of red flag that PPH looks for in its preparation for RAC audits: If a patient comes in for a procedure, the record should include the order for the procedure, evidence of the procedure being performed, then the billing with the proper code. A review of the documentation should reveal all of that information, and it all should be consistent. In other words, the procedure ordered should match what was performed and what was billed. It sounds obvious, but somewhere along the way, those items can change.
"The absence of any item is a red flag, and any mismatch between the information is a problem," he says. "If we can see it, any RAC auditor can see it, too."
In addition, PPH is hiring a registered nurse under the finance umbrella instead of utilization review to work as a clinical auditor. This employee will do more of the defensive audits and reviewing of areas that are suspicious to PPH.
"Normally, this kind of review would be done under the quality department; but because of the substantial implications, this person will be reporting to the RAC committee under the finance umbrella," Boyle says. "Another thing we did was to educate the various staff people who would be involved in this project about the RAC process and, in some cases, about billing and coding. It was always a barrier when someone didn't see the whole picture, so we tried to educate everyone on the RAC committee about how the processes are tied in and changing one process can have an effect somewhere else."
Boyle recommends using some sort of electronic tracking tool for RAC audits. Without a software tracking tool, it is nearly impossible to adequately track overlapping audits and follow up on all the documentation requests and submissions.
"For each one, you have to circle back and fix the problem if there is one, or defend the issue if you disagree with the audit conclusion," he says. "There are time lines and deadlines to be set up for each of these steps."