Nancy Hirschl, CCS	Lori Brocato

Medicare is using sophisticated software programs to mine claims data and identify potential overpayments to providers. Likewise, the recovery audit contractors (RACs) are deploying technology at a rapid rate and will be completely electronic by 2010. With so much technology being applied by the opposition, it's imperative that hospitals take a close look at what systems they'll need to make audits as painless-and successful-as possible. The demonstration project proved that trusty spreadsheets and desk-top databases don't give provider organizations the tools they need to win against the RAC, nor should they!

Technology is an HIM director's best ally when preparing and responding to RAC. In this month's column we'll learn how.

Existing Systems: Are They Battle-Ready?
Technology is a critical weapon in the HIM director's preparedness arsenal. A thorough technology assessment as part of the overall preparedness plan goes a long way in winning the battle against RAC. From start to finish, organizations must know what technology tools they have available and what new systems they may need.

The first step in assessing RAC technology capabilities is to review existing systems in registration, coding, billing and financial reporting as follows: 

• ·Make sure inpatient and outpatient claims data is clean by ensuring claims scrubbers, editing software, charge capture systems and charge masters are correct and up-to-date.
• Check software tools used by coders, case management, clinical documentation improvement teams and compliance. Are they current and are alerts set for specific RAC-targeted diagnosis, procedures, etc.?
• Audit registration systems along with their associated interfaces to coding and billing applications to ensure data is being captured, transmitted and shared between systems correctly. Also, are all checks and alerts functioning correctly (e.g., medical necessity prescreening)?
• Finally, double-check financial reporting tools and business intelligence software for data compilation and reporting accuracy.

Once existing systems are reviewed and updated it is time for HIM directors and their RAC teams to identify technology gaps-and fill them!

Tracking RAC Appeals: What You'll Need
Next on the technology checklist is RAC tracking software. This is where many organizations fell short during the demonstration project by relying on Microsoft® Excel spreadsheets and ACCESS databases. While these desk-top applications may suffice for smaller organizations and physician practices, HIM directors employed by larger hospitals or settings with multiple National Provider Identifiers (NPIs) need more.

The RAC tracking technology you select should be easily accessible by everyone on the RAC team-from multiple locations. In addition, it should provide high-level dashboard and executive reporting capabilities along with the option to import information in multiple formats (paper-based or electronic).

• RAC tracking software to enter request information, capture all case details, track appeal dates and status, and log correspondence.  
• Integrated document management technology to store copies of documents sent to the RAC, upload RAC correspondence, support internal communication for the RAC team, and import discrete data from other systems (e.g., claims management, patient accounting, case management and admission-discharge-transfer systems).
• Outcomes reporting system to analyze RAC appeal results, protect cash, and predict future financial impact.

RAC Tracking Tool
A formal RAC tracking tool helps reduce technical denials (those where organizations fail to meet RAC deadlines) and manage the large volume of record requests. A growing number of HIM directors are relying on their release-of-information (ROI) vendor to handle all requests from the RAC and provide a RAC tracking tool. For example, Stan Padfield, RHIA, director of HIM at Lee Memorial Hospital in Fort Myers, FL, used the HealthPort ROI team to track down the charts, scan them into a centralized tracking system along with all correspondence, and ultimately provide a RAC database for tracking.

The American Health Information Management Association (AHIMA) recently published a list of data points ("RAC Ready", Johnson, Kathy, RHIA, Bloom, Allison, MBA, RHIA, Morris, Denise, RHIA, CCS; and Madamba, Rod, RHIA. Journal of AHIMA, February 2009-80/2, pg. 30), which should be captured by the RAC tracking tool:

• Internal log number
• External tracking number (e.g., from the RAC)
• Date of request
• Medical record number
• Account, encounter, or visit number
• Discharge data and length of stay
• Original DRG or diagnosis
• Date record sent
• Copying fees and invoicing

Review and Approve: An Important Lesson in Cash Protection!
The tracking software should also provide a "review and approve" queue. This allows someone in HIM to check documents for completeness before they are sent to the RAC. This extra, up-front step ensures records are complete and all documents requested by the RAC are sent. Additionally, the HIM department can take a moment to assign a level of financial risk for each case and include this information in the RAC tracking system.

Finally, this step helps organizations identify trends in "type" of cases being requested by the RAC and take aggressive steps to minimize denials. Based on this important HIM feedback, RAC teams should take preventative measures early and often to combat the enemy and protect their cash!

Document Management Technology
Copies of all documents sent to the RAC should be stored and made easily accessible to all RAC team members. In this way, HIM departments can prove what they sent to the RAC-and when! These images are also an important part of the appeals process to help RAC teams back-up their case and fight denials.

Secondly, some type of "scan and store" system is needed to capture all correspondence from the RAC and incorporate hand-written notes and electronic documents created by the RAC team as a by-product of case review and appeal processing. Ideally the document management technology will be completely integrated with the tracking tool mentioned above. In this way, the entire RAC team has a centralized repository for case information, medical records and RAC documents.

Outcomes Management Software
The last key piece of technology for RAC is outcomes management software. As more and more cases are requested, reviewed, appealed and finally closed, it is imperative that HIM directors and their RAC teams can analyze outcomes. This is important for several reasons:

• Determine the cost-benefit ratio for RAC appeals. Which cases are worth pursuing an appeal?
• Pinpoint areas of weakness by diagnosis, procedure, physician, coder, etc. and take corrective measures to prevent future denials.
• Quantify the financial impact of RAC and conduct a comprehensive analytical assessment of risk.

With the help of outcomes management technology, organizations can determine what RAC costing them in human resources, time and Medicare take-backs. Secondly, this type of software will help mitigate future financial loss and identify what amount of money should be "set aside" to prevent underfunding of RAC.

As projected by information technology leader John Halamka, MD, CIO of Boston's Beth Israel Deaconess Medical Center and Harvard Medical School, "we'll see the need for more sophisticated tracking systems to intake audit requests and track them through their life cycle." From the initial request to denial letters and the appeal process, it is critically important that HIM directors have the systems in place to track and manage RAC. Stay tuned next month when we turn our eyes toward clinical documentation improvement and coding strategies relevant to RAC.

 Lori Brocato is currently the revenue cycle management product manager for HealthPort. Nancy Hirschl is president and CEO of Hirschl and Associates, Laguna Niguel, CA.