To: CA, NY and FL Representatives to the State Society Network;
CA, NY and FL State Presidents;
CA, NY and FL Urology CAC members

From: Rai Flynn, AACU State Affairs Manager; Sam Shepard, AACU Director of Health Policy

RE: AACU actions in CMS Recovery Acquisition Contractors (RAC) Program

Date: 5/5/05

cc: State Representatives to the State Society Network
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AACU and the State Society Network have strong concerns with the CMS Recovery Acquisition Contractors (RAC) program. As you may know, this new pilot project will be looking into overpayments made by CMS for Medicare Part A. The RAC, a result of the Medicare Modernization Act of 2003, is about to be implemented in Florida, California and New York. The AACU and the State Society Network want you to know we will be monitoring the program and alerting our members of any new information with regard to the audits and nature of the contractors’ recoveries. Additionally, we will ensure you are informed if RAC contractors alert CMS they will be auditing for Medicare Part B.

On Wednesday May 4th, AACU Government Affairs participated in a call with Paul Speidell, Assistant Director of Federal Affairs at the AMA. Paul is the AMA point person for the RAC program. He is eager to work with the AACU on this issue and will inform us about new developments. He is also working with CMS to hold meetings in the three states and AACU has promised to have urology represented in those meetings.

AACU will be working closely with the AMA. When the time comes, the AACU, in partnership with the AMA, will be working with urology to make our voices and concerns heard. We have attached a recent article written for the Florida Urological Society newsletter for your information. The AACU has already begun informing urologists in your state about the RAC. Feel free to contact us at anytime with questions.

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New Shark-Like Audit Program has Florida Physicians Worried
By: Rai Flynn, AACU State Affairs Manager
For the Florida Urological Society Newsletter

In May, the Centers for Medicare and Medicaid Services (CMS) will use outside contractors to review claims in Florida, California and New York. The purpose of the expeditious audit is to make sure the government is paying appropriately for services. The problem is that these private firms, which are supposed to look for both underpayments and overpayments, will be paid based on how much overpayment they can recoup from physicians.

One fear is that the project may produce some questionable results because these private firms will be looking to maximize their profits. Another fear is that if this pilot project is successful, the program might be expanded to other states. The American Medical Association (AMA) has already been working on the issue. They have arranged meetings between CMS and the Florida, California and New York state medical societies. In addition, they had CMS Administrator, Mark McClellan, MD, PhD, speak at the AMA National Advocacy Conference. Dr. McClellan sought to calm doctors’ fears by saying the new audits will not turn into bounty hunts and “doctors acting in good faith should not be the target of this program.”

This new initiative, which was mandated by the Medicare Modernization Act of 2003, will focus mainly on hospital claims and outpatient procedures and not Evaluation and Management (E&M) claims. But that has not calmed doctors’ fears that the project will eventually allow E&M codes to come into play.

Along with the AMA, other specialty organizations, like the American Association of Clinical Urologists (AACU), have decided to track this project. “Urologists are being hit on all sides, from declining reimbursements for LHRH agonists to new attacks on in-office imaging services; the last thing they need is the specter of new, money-driven audits based on quotas hanging over their heads,” said Sam Shepard, AACU Director of Health Policy.