Demystifying the Query (Audit) Process

Demystifying the Query Development process is key to every health care provider’s success regardless of the type of services delivered.  It requires an understanding of the resources, references and tools used by RACs so providers can maintain their organization’s preparation for CMS audit “participation.” Let’s dsicuss the Query (Audit) Process in detail.

Vickie Axsom-Brown, Senior Consultant, BHM Healthcare Solutions

A stethoscope with a red-stamped RAC. Learn more about the Query (Audit) Process in our blog.

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The tools used by RACs are vast and may look like alphabet soup.  The “New Issue” process begins with the responsible team’s identification of potential billing/reimbursement issues.  The typical “New Issues” team is comprised of experienced claims’ processing representatives with Part A, Part B, DME, pharmacy, home health, hospice, hospitals, providers, SNFs, et. al. specific backgrounds. This team uses their experience and multiple resources to identify potential issues for which analysis will be done to validate issue value.

In addition to experience, the following data sources are used (the alphabet soup):

  • Raw Data – RAC database, routine CMS RAC Data Warehouse downloads, industry trends…
  • Outcome Reports – CERTs

[i], OIG[ii], PEPPER[iii], GAO[iv], QIOs[v]….

  • Industry Experience[vi] & Information – AAHAM, AHA, AMA, AAASC, JCAHO, JCAHACO…
  • Policy/Rules and Regulations[vii] – LCDs, NCDs, CRs[viii], IOMs, MLN…
  • CMS Programs – ZPICS[ix], DOJ[x], Vulnerabilities Reports[xi], Carriers, FIs, MACs
  • Information is collected and evaluated to determine potential improper payment trends, type of provider(s) involved, resources and financial impacts, and projected outcomes.  Data are analyzed by statisticians and/or SAS analysts to define the each of these elements by targeted provider type(s). Once analytical results are provided to the New Issue team, the list of improper payments is prioritized and the New Issue submission type/preparation begins.

    Different submission criteria exist for New Issue automated reviews (examples of findings and results required) and New Issue complex reviews (medical record documentation and evaluation findings required).  The RACs preparation and submission processes vary due to CMS Review Board supportive information/analytical requirements and can range from 30 to 120 days preparation prior to RAC submission to CMS.

    All New Issues require complete data presentation with projected Medicare Trust Fund returns.  The CMS New Issues submission package is well-defined and must meet all specifications before presentation to the CMS Review Board.  If a New Issue package fails any defined criterion, it is returned to the RAC for re-submission.  This means the RAC loses a place in line for the CMS Review Board’s review/approval of a New Issue. 2010, the CMS New Issues Review Board had an ever-increasing New Issues backlogs resulting in their encouragement that all RACs collaborate on a list of New Issues for Board consideration.  RACs pursued the recommendation and drafted eight (8) New Issues for collaborative submission to the CMS Review Board.

    Upon receipt of a New Issue package, designated CMS Review Board representative(s), review(s) the package for submission compliance, content, New Issue review type (automated/complex), value (financial returns), and review submission direction.  The New Issue package may be presented to the RAC Validation Contractor for assessment and recommendations and/or to the CMS Review Board (physicians, policy makers, et. al.).  Once reviewed, the CMS Board generates a decision:

    1-      Approved as submitted.

    2-      Approved with modifications.

    3-      Approved with defined limitations.

    4-      Denied for current review period, resubmit in one year.

    5-      Denied.

    Approved New Issues are posted on the RACs’ provider portals and are available for the RACs inclusion in future audits.

    [i] Comprehensive Error Rate Testing (CERT) Program reports (  Lists reports by hear and Report Type, e.g., Over utilized codes, CERT findings, Use corrective actions to monitor improper payment findings.  This website usually accessible from Carrier/FI/MAC Website link.

    [ii] Office of Inspector General Reports (

    [iii] Program for Evaluating Payment Patterns Electronic Report (PEPPER); Published by TMF Health Quality Initiative under contract with CMS…Audio on demand for Pepper information; PEPPER 2011: Identify Changes, Address Vulnerabilities and Be Audit-Ready

    [iv] General Accounting Office “GAO” Reports (

    [v] Quality Improvement Organization Reports,

    [vi] Inpatient, Ambulatory, Outpatient, DME, SNF, CORF, Rehab, Hospice, Physician,;;  high risk coding errors, duplicate claims, pricing errors, billing excessive units, failure to meet LOC requirements,  payment errors, SNF consolidated billing, cross over coverage (ambulance, medications, ), questionable level of care, improper diagnosis codes, mismatched codes,

    [vii] Local Coverage Determinations (LCDs), National Coverage Determinations (NCDs)

    [ix] Zone Program Integrity contractor – ZPICs (former Program Safeguard Contractors)

    [xi] Vulnerability Reports (multiple references); – Spotlight or Key Issues section  or

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