Their contractors deny virtually every appeal at the first two appeal levels, where the CMS contractor gets paid a percentage for every identified RAC claim. At the third level where the appeal involves an administrative law judge who is outside of the RAC contractors' purview, the game changes. At the ALJ level, WMHS has won virtually every appeal.
Unfortunately, CMS and their contractors got greedy and as a result, hospitals and health systems are now challenging every denial at the administrative law judge appeal level. Previously, many hospitals budgeted a percentage for the RAC process as a cost of doing business, but not any more. As a result, it would take decades to hear every appeal at this level.
Since CMS put a flawed process in place, they are now offering hospitals 68 cents on the dollar to settle short stay claims and scrambling to figure out a solution to their backlog of the rest of their cases. Of course, hospitals are taking advantage of the settlement offer.
At WMHS, we have had over $10 million dollars tied up in all RAC appeals; and through the settlement just for short stay disputes, we should receive over $3 million.
Now the editor of Fierce Health Finance is equating hospitals to the five year old who hasn't gotten his way. Really? I took the opportunity to read previous editorials from this same guy and he is obviously no friend of hospitals. It's time to cancel my subscription to Fierce Health publications; if you can't be balanced in your editorials, I have no use for your tainted opinions.