Packer Perspective

A message from Greg Packer, President US Rehab

At US Rehab, we hear the frustrations of independent CRT providers every day. Working daily with members, Ronda and Peggy have heard hundreds of stories of how Medicare audits are wreaking havoc on our industry and the patients we serve. I wanted to be sure to highlight the recent announcement that RAC audit would be temporarily halted as CMS transitions to new contracts and Peggy Walker’s recent efforts at the Office of Medicare Hearings and Appeals (OMHA) forum. Peggy is a national leader in providing guidance on Medicare policy and attended the forum to provide written comments to policy makers on the most glaring shortcomings of the current audit system.  

The focus of the OMHA forum was to provide detail on the 460,000 appeals backlog and identify potential solutions for the ALJ’s to work their way through it. In light of this, the main focus of Peggy’s comments was the fact that so many cases reach the ALJ appeals level that should have been taken care of at the first two levels of appeal. Peggy repeatedly questioned CMS whether the first two levels of appeal can reopen cases in the event there is a technical/clerical error or discrepancy, rather than a question about medical necessity. CMS responded that the MAC’s and QIC’s currently have that authority. Peggy responded, “but they aren’t doing it! I have dozens of examples. This is a big part of the problem when you are talking about the ALJ backlog.”

A copy of Peggy’s written comments and the accompanying stories can be found here.  (click here)

Just weeks after the OMHA forum, CMS announced they will temporarily halt the RAC program as they transition to new contracts. Also included in the CMS announcement were several reforms CMS plans to include in the new round of RAC contract offerings. Several of the reforms mentioned are very closely aligned with what the DME industry has been saying for months, as highlighted by Peggy’s comments at the OMHA forum. 

The reforms that CMS is reportedly making to the new contracts for auditors include:

1) RAC’s will have to wait 30 days to allow for a discussion before sending the claim to the MAC for adjustment. 

2) RAC’s will be required to confirm with the provider receipt of a discussion request within three days.

3) RAC’s will wait until the second level of appeal is fully exhausted before they receive their contingency fee.

4) CMS will establish new and revised ADR limits that will be diversified across different claim types (e.g., inpatient, outpatient).

5) CMS will require RAC’s to adjust the ADR limits in accordance with a provider’s denial rate. Providers with low denial rates will have lower ADR limits while providers with high denial rates will have higher ADR limits.

These reforms are a welcome change, but there is more work to be done to ensure the system actually begins to function as intended for complex rehab providers. It has been said before, but it bears repeating, audits are not going away, so we must continue to reform the process until it works for independent providers.Accountability and transparency are badly needed in the RAC program and we must continue to voice our frustrations to ensure we are represented in any changes that are made.

With new RAC’s requests suspended for the next few months,what better time to take stock of your billing processes and dedicate time for your billing department to learn about new documentation requirements and best practices? US Rehab’s Peggy Walker and Ronda Buhrmester are hosting a series of webinars over the next few months, free of charge to members, on new face-to-face requirements, common documentation issues and audit prevention.Contact US Rehab to learn more about the webinar schedule.

Thank you for your time, and, as always, please feel free to contact me directly at any time.



Greg Packer

President, US Rehab