Ignoring Them May Be Costly

Medicare’s Recovery Audit Contractor (RAC) gets paid based on how much overpayment they find in your practice. They have a direct monetary incentive to aggressively search for and claim overpayments! Because RACs are paid on a contingency fee basis, they are highly motivated to find errors!

The improper payments identified by RACs included:

• Payments made for services that did not meet Medicare’s medical necessity criteria (e.g. therapy sessions that were excessive or delivered in an inpatient or "unnecessary" setting).

• Payments made for services that were coded incorrectly or failed to comply with Medicare/CPT guidelines (e.g. principal diagnosis on the claim did not match principal diagnosis on the medical records).

• Failure to support claims with proper medical documentation (e.g. medical records did not describe adequately the procedures reported on the claim).

• Submittal of claims to Medicare that should have been submitted to another insurer (e.g. failure to meet Medicare secondary payor criteria).

• Other reasons, such as submitting duplicate claims or using outdated fee schedules.

Subject: Internet-Based Provider Enrollment, Chain and Ownership System (PECOS) For Physicians, Non-Physician Practitioners, and Solely-Owned Organizations

Organizations Must Be Enrolled Before Individuals: Before a physician or nonphysician practitioner can reassign their benefits to a medical group or clinic other than the one they solely own, the medical group or clinic must have an approved enrollment record in PECOS.

Initial Enrollment Application for an Individual: Physicians and non-physician practitioners who have not enrolled or updated their Medicare enrollment since November 2003 will need to complete an initial enrollment application. PECOS does not contain information for physicians and non-physician practitioners enrolled before November 2003 who have not updated their enrollment record since that time.

Using Internet-based PECOS: We suggest you use Internet-based PECOS because it is faster and more efficient than the paper enrollment application process. Before you begin to use Internet-based PECOS, you should:

• Be sure that you have the National Provider Identifier (NPI) that was assigned to you as an individual and, if you solely own an organization provider, the NPI assigned that was assigned to your organization.

• Review the document titled, “Internet-based PECOS -- Getting Started Guide for Physicians and Non-Physician Practitioners.” This document can be found at: http://www.cms.hhs.gov/MedicareProviderSupEnroll/downloads/GettingStarted.pdf

Reporting Responsibilities: Physicians and non-physician practitioners enrolled in the Medicare program have reporting responsibilities. See the download section found at www.cms.hhs.gov/MedicareProviderSupEnroll  for information about your reporting responsibilities.

More Information: For more information about Internet-based PECOS, including contact information for the External User Services (EUS) Help Desk, go to www.cms.hhs.gov/MedicareProviderSupEnroll  and select the “Internet-based PECOS” tab on the left side of screen.