RAC Audits - Pneumatic Compression Devices

Home Blog RAC Audits - Pneumatic Compression Devices

On January 23, 2019, the DMEPOS and Home Health Recovery Audit Contractor (RAC) Performant added Pneumatic Compression Devices to their CMS Approved Audit Issues log. The reviews are defined as complex reviews for claims with a paid date more than 3 years prior to the Additional Development Request (ADR) letter date. Performant indicates that pneumatic compression devices (HCPCS Codes E0651 and E0652) may have been provided to patients where all Medicare coverage criteria were not met. The review will determine if the pneumatic compression device provided was reasonable and necessary for the patient’s condition based on the documentation in the medical record. Claims that do not meet the indications of coverage and/or medical necessity will be denied.

Although this audit was added in January, many suppliers have only recently received ADR letters from Performant requesting additional documentation to support the devices previously paid. Why such a large gap between the initial approval date and now? To answer that, you will need to understand how an item lands on the approved issues log. The RAC must get approval from CMS for any potential issues prior to begin auditing claims. If a potential issue is approved, CMS determines the volume, or number of claims, that Performant can review. Once the initial volume of claims has been audited, the RAC reports findings back to CMS, at which time CMS may grant additional approval for more audits. Based on this process, it is likely the initial round of claims for pneumatic compression were audited and resulted in a high percentage of medically unnecessary determinations. Since the RAC is responsible for recovering Medicare funds paid in error, the likelihood that auditing more claims would result in overpayments is high.

So what should you do if you receive an ADR from the RAC? First, review the request for the date of service and ensure that you have medical documentation that corresponds. If you determine that your medical documentation is lacking, reach out to the beneficiary’s physician and request documentation to support the equipment ordered. Be sure that you respond to the ADR completely and within the timeframe indicated on the letter.

Upon completion of the review, the RAC will issue a Review Results Letter (RRL) explaining if the documentation provided supports the equipment, as indicated in the Local Coverage Determination (LCD) and accompanying Policy Article (PA). Know that there is an option to request a Discussion Period, should you disagree with the RAC’s findings, or determine that you have additional documentation that would reverse the decision. If you cannot provide additional documentation or are unsuccessful at the Discussion period, your claim will be sent to the DME MAC to process the adjustment and initiate the overpayment process. You will have the opportunity to dispute, or appeal, the claim to the DME MAC once you have received the overpayment demand letter.

If you have received a RAC audit and aren’t sure where to start, The van Halem Group can help. Our team offers proactive and reactive services to assist you. If you receive an audit request from the RAC our clinical team will review the claim file and respond to the audit on your behalf. If denied, we will work with you to obtain addendums and appeal the overpayment.

Want to feel confident that the equipment you are providing meets coverage criteria? Sign up for our clinical prescreen review program. Before you put out the equipment, let our clinical staff review your documentation to ensure the equipment meets coverage criteria. Our clinicians will review your documentation and provide you with an “approved” or “denied” status, along with recommendations for your referral source. Get your documentation right before you bill the claim to Medicare, and rest easy knowing you are protected should those claims be audited in the future.


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