On February 20, 2014, Brian Daucher and Claudia Reingruber (Reingruber & Assoicates) presented “Medicare Post Payment Audits (RACs, ZPICs, and Other Tools)” to the American Health Lawyers Association Annual Meeting for Long Term Care and the Law Conference in Las Vegas, Nevada.  The presentation covers the structure and operational characteristics of Zone Program Integrity Contractors, tools to prepare for such audits, and advice about useful appeal arguments related to such audits.  Here are some key takeaways.

The post payment auditing system is constantly evolving including:

• Replacement of RACs with Regional Auditors, including one dedicated to Home Health & Hospice
• Replacement of ZPICs and MIC with UPICs (Unified Program Integrity Contractors)
• Ongoing utilization by CMS of automatic reopenings through Informational Unsolicited Response action.

The appeals system is breaking under the strain of additional appeals flowing in from MACs, RACs, ZPICs, and the IURs.  Providers face a 2+ year backlog at the ALJ level and increasing delays at lower levels as well.  As an initial step, CMS has finally suspended further RAC auditing pending RAC re-authorization.  CMS promotes additional post payment appeals, but has failed to fund the appeals system to ensure that providers are treated fairly.

For hospices:

• Medical necessity audits are giving way to face to face and related care audits, which will be easier for the new Home Health and Hospice RAC to audit.
• Drug reporting requirements will be followed by more scrutiny of formulary decisions.