Delayed RAC review demo to begin in June

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The Centers for Medicare & Medicaid Services (CMS) announced that its Recovery Audit Prepayment Review Demonstration will move forward by June 1.

The demonstration initially was scheduled for a January 1 implementation date but was delayed due to provider concerns.

The project allows recovery audit contractors (RACs) to review claims before they are paid, focusing on the types of claims historically associated with high rates of improper payments in seven states (California, Florida, Illinois, Louisiana, Michigan, New York and Texas) and claims with high volumes for short inpatient hospital stays in four states (Missouri, North Carolina, Ohio and Pennsylvania).  

CMS stated it expects this demonstration to also help lower the error rate by preventing improper payments rather than the traditional "pay and chase" methods of looking for improper payments after they occur.

There were no major changes to the RAC pilot program.