I’ve received calls about a Medicare Advantage Risk Adjustment request. Is this a type of RAC audit?


Q: I've received calls about a Medicare Advantage Risk Adjustment request. Is this a type of RAC audit?

A: No, this is not a RAC audit and it does not put you at risk of a fine or other punitive action.

The Centers for Medicare and Medicaid Services require that Medicare Advantage Organizations (MAO) conduct annual risk adjustment assessments for all healthcare providers that render services to Medicare Advantage beneficiaries. For Medicare Advantage members, the risk adjustment program began in 2000, and was implemented in phases, with implementation complete in 2007. Over the years, other insurance programs have also adopted the risk adjustment program to encourage insurers to compete on quality and efficiency, preserve consumer choice, and improve quality of care for patients.

Requests for medical records

Medical record request differ between MAOs and commercial payer plans, even though both MAOs and commercial plans may contract with a third-party vendor to conduct the review for the identified medical records. Under the Health Insurance Privacy and Accountability Act - CFR 164.502 - (HIPAA), providers are allowed to disclose the requested medical record information for the purpose of health care operations as long as a “general consent” has been obtained and saved in the patient chart.

MAOs and commercial plan risk adjustment process uses ICD-9-CM diagnosis codes to assign risk scores for its members. During the review, the reviewer is looking to ascertain that the medical record documentation supports the ICD-9-CM code assigned for an encounter and that any, and all coding rules and sequencing guidelines are adhered to.

MAOs have recently initiated risk adjustment review requests and are contacting select providers to review patient medical records. If you receive a request from a MAO or third-party vendor requesting a medical record review under the risk adjustment process, keep in mind that this is not an audit and you are not at risk of a fine or other punitive action.

Reviewing medical record documentation and data validation ensures the integrity and accuracy of risk scores e.g. ICD-9-CM code choice, coding guidelines and sequencing rules etc. Medical record reviews often identify additional conditions not captured through claims or encounter data and verify the completeness of coding.

Here is how the process works:
  • Medicare Advantage Organization (MAO) or a third-party vendor sends a request for medical records to the provider (usually anywhere from 10 – 30 charts depending on provider contract or number of patients seen by the provider);
  • The MAO or sub-contractor reviews records to ensure the billed services are supported by the medical record documentation;
  • The MAO or sub-contractor provides a report to Medicare Advantage or Medicare carrier (depending on who conducted the review) on findings;
  • If further chart review is required, the review result can amount to no further action against the provider.