1st Quarter 2012 RACTrac Top Medically Unnecessary Denials

on Wednesday, 30 May 2012. All News Items | Recovery Auditor

RACTrac is a free, web-based survey developed by the American Hospital Association (AHA) that provides hospitals with information on how the Recovery Auditor Program is impacting hospitals nationwide. The 1st Quarter 2012 Report (October 1, 2011 – December 31, 2011) was released May 10, 2012.


Key Findings:


  • 93% of participating hospitals with Complex Denials indicated that medical necessity denials were the most costly complex denial.
  • The Top 5 MS-DRGs that were found to be medically unnecessary and had the largest financial impact on hospitals were:
    • MS-DRG 312: Syncope & Collapse
    • MS-DRG 247: Percutaneous Procedure with Drug-Eluting Stent without MCC
    • MS-DRG 313: Chest Pain
    • MS-DRG 069: Transient Ischemia
    • MS-DRG 392: Esophagitis, Gastroenteritis and Miscellaneous Digestive Disorders without MCC
  • Participating hospitals indicated that that are appealing “nearly one-third of all RAC denials, with a 75% success rate in the appeals process.”
    • More than half of these appeals were reported as appeals for short stay medically unnecessary denials.
    • “More than half of all hospitals with a RAC denial overturned had a denial overturned because the care was found to be medically necessary.”


Medicare Fee-for-Services National Recovery Audit Program Quarterly Newsletter
Following quickly on the heels of the RACTrac report, the January 1, 2012 – March 31, 2012
Medicare Fee-for-Services National Recovery Audit ProgramQuarterly Newsletter was released on May 18th.


Cardiovascular Procedures, a Trend Emerges:

The same Top Issue per Region for this quarter was identified in Region’s A, B and C and was Cardiovascular Procedures. The Recovery Auditors collected $376.2 million dollars in overpayments for these three regions combined. The Center for Medicare and Medicaid Services (CMS) reminds providers that:

“Medicare pays for inpatient hospital services that are medically necessary for the setting billed. Medical documentation for patients undergoing cardiovascular procedures needs to be complete and support all services provided in the setting billed.”

Potential Financial Impact for DRG 247 Medically Unnecessary Determinations:

In an effort to anticipate the financial impact for our clients we pulled data specific to DRG 247 in Calendar year 2011 from our sister company RealTime Medical Data. Below is what we identified:


Calendar Year 2011 DRG 247 Data


Statewide Volume

Total Charges

Total Actual Paid

Total Average Paid








1.8 days

2.57 days






1.8 days

2.56 days

South Carolina





1.8 days

2.57 days






1.8 days

2.52 days






1.8 days

2.55 days

Source: RealTime Medical Data Report: Provider CMI Details by DRG with Statewide CMI January 1, 2011 - December 31, 2011


Conclusions and Recommendations:

  • A large volume of cardiac stents procedures continue to be performed in the Inpatient setting.
  • There is $1,801 variance in the state average payment for the same MS-DRG.
  • As DRG 247 is a target on the PEPPER Report MMP, Inc. recommends that you review your hospital’s PEPPER Report for DRG

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