New Process for Recovery Audit Demand Letters from Trailblazer

Trailblazer sent an email yesterday reiterating some points regarding demand letters for audits.  This currently only covers Part A providers, but Part B providers, which include most ambulance services, should be aware of what is going on with regards to the RAC’s and other audit entities.  Text of the email after the jump:


New Process for Recovery Audit Demand Letters

Date: (2/1/2012)
Notice ID: 14512
Note: This notice has been updated to add Tips and Reminders.

Effective January 3, 2012, recovery auditors will submit claim adjustments to the Medicare Administrative Contractor (MAC) who will perform the adjustments based on the recovery auditor’s review and issue an automated demand letter to providers. The Recovery Audit Contractor (RAC) will continue to issue first demand letters until January 3, 2012.

To assist providers with internal tracking of overpayment demand letters, providers may request that the demand letters be sent to a specific person or department at the provider’s facility.

TrailBlazer will be sending the automated first demand letter for the recovery audit overpayments to the physical address listed on the provider file. Line 2 of the physical address is normally reserved for the “Doing Business As (DBA) name,” on the 855A enrollment form (if identified by the provider).

If providers wish to designate a specific person or department on Line 2 of the physical address instead of the “DBA name,” they must mail a cover letter on company letterhead to the Part A Provider Enrollment department identifying the person’s name or department name to be included in this field. Please note that the 855A enrollment form must also accompany the letter with the name listed on line 2 in section 4 of the 855A. It is very important that providers clearly indicate in their cover letter the information to be included on Line 2 of the physical address.

Note: All correspondence sent to the physical address will be addressed to the attention of the specified person or department.

Tips and Reminders

  • The purpose of this change is to increase consistency and efficiency through automation (i.e., demand letters for any RAC-identified overpayment are issued using the same process as any other overpayment recoupment).
  • The physical address is used because the letter is automatically generated by Healthcare Integrated General Ledger Accounting System (HIGLAS) when the claim adjustment processes.
  • TrailBlazer is aware that the desired person or department is not always located at the physical location of the facility. Therefore, we encourage providers to educate mail room staff on the appropriate routing of such correspondence.
  • RAC overpayments can also be identified with remark code N432 on the Remittance Advice (RA) and the RAC will continue to send findings letters that explain its determination.
  • CMS is aware of providers’ concerns with these changes and is working with Medicare contractors on possible modifications to the process.

Single Point of Contact for RAC-Related Inquiries

To ensure timely coordination and control of recovery audit-related inquiries received by the Customer Service Provider Contact Center (PCC), all recovery audit inquiries will be escalated to a Provider Relations Research Specialist (PRRS) for research and resolution. This will provide a single point of contact for all recovery audit inquiries and correspondence.

Change Request (CR) CR 7436 External Link Icon, Transmittal 202, dated January 6, 2012.

This content pertains to…

Programs: Part A
Topics: Claims Information, Customer Service, Payment, Provider Enrollment, Quality Initiatives
Subtopics: Overpayment-Voluntary Refund, Recovery Audit Contractor

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