1. “10 Critical Actions to Minimize RAC Recoupment” National Medicare RAC Summit Washington, DC March 6, 2009

2. Presenters Stephen Forney, MBA, CPA, FACHE, FHFMA VP - Margin Development Ardent Health Services Nashville, TN 615-296-3054 stephen.forney@ ardenthealth.com Bill Phillips, FACMC, CHC Associate Professor Health Svcs Mgt & Ldrshp Geo Washington Univ. / VP & Chief Revenue Off Revenue Strategies 786-371-6493 billinfll@juno.com 3/7620092(c) 2009 Revenue Strategies

3. Outline A.How to Minimize RAC Recoupment B.RAC - Newest ATM C.Take Home… 3/7620093(c) 2009 Revenue Strategies

4. A.How to Minimize Recoupment 3/7620094(c) 2009 Revenue Strategies

5. 10 Critical Actions 1.RAC is not FI 2.Appoint Chief RAC Officer 3.Prepare, prepare, prepare (7 steps) 4.Conduct pre-RAC Audits 5.Implement RAC Record Request Tracking 3/7620095(c) 2009 Revenue Strategies

6. 10 Critical Actions 6.Establish clinical & coding feedback 7.Calculate impact of overpayments 8.Start Yesterday 9.Appeal, appeal, appeal 10.Re-bill all IP denials as OP 3/7620096(c) 2009 Revenue Strategies

7. # 3. Prepare, Prepare, Prepare Seven Steps 1.Identify all cases at risk 2.Prioritize by recoupment impact 3.Perform coding & medical necessity reviews 4.Establish RAC repository 5.Test RAC work flow 6.Prepare Recoupment Reports 7.Apply RAC up-dates (new targets, etc.) 3/7620097(c) 2009 Revenue Strategies

8. # 4. Conduct pre-RAC audits ServiceVolumeRecoup / Claim Cardiac Defibrillator2,200$ 29,500 Surgical Procedures5,400$ 16,500 Respiratory w/ Ventilator2,100$ 15,400 Excisional Debridement6,100$ 10,000 Heart failure & Shock6,100$ 5,400 Average Recoupment$ 15,320 3/7620098(c) 2009 Revenue Strategies

9. B.RAC – Newest ATM 3/7620099(c) 2009 Revenue Strategies

10. RAC Recoupment ATM # 1: Automated Electronic claim review – Duplicate claims – Same patient – Same date of service – Duplicate payment – RAC withdrawal ATM # 2: Complex Manual review – Suspected error – Medical record needed 45 days to reply – Site of service issue – Proper documentation – 1/3 are overpayments 3/76200910(c) 2009 Revenue Strategies

11. Automated vs. Complex AAUTOMATEDCOMPLEX TIMINGEarlyLater Medical RecordNoYes AppealableNoYes RAC AccuracyHIGHLOW Recoupment$ 8,000$ 8.400 RecoupmentLOWHIGH Hospital EffortLOWHIGH 3/76200911(c) 2009 Revenue Strategies

12. C.Take Home 3/76200912(c) 2009 Revenue Strategies

13. # 1: RAC – aka “Margin Eraser” RAC 3/76200913(c) 2009 Revenue Strategies

14. 2009 Margin CY 2009In millions GPSR$ 1,220 Margin$ 4.0 Percent0.3 % 3/76200914(c) 2009 Revenue Strategies

15. Unprepared - 2010 Margin CY 2010After RAC GPSR$ 1,220 RAC Recoupment$ 3.0 New Margin$ 1.0 Net Change($ 3.0 ) Erased Margin$ 3.0 3/76200915(c) 2009 Revenue Strategies

16. Prepared - 2010 Margin CY 2010After RAC GPSR$ 1,220 RAC Recoupment$ 1.0 Margin$ 3.0 Net Change($ 1.0 ) Erased Margin$ 1.0 3/76200916(c) 2009 Revenue Strategies

17. # 2: Start yesterday… Review - Oct 1, 2007 – Apr 1, 2011 Reviewable Now – Oct 1, 2007 – Mar 6, 2009 – 18 months Reviewable Later – Mar 6, 2009 – Apr 1, 2011 – 24 months or more… 3/76200917(c) 2009 Revenue Strategies

18. # 3: Prepare, Prepare, Prepare 3/76200918(c) 2009 Revenue Strategies

19. # 4: Appeal, Appeal, Appeal 3/76200919(c) 2009 Revenue Strategies

20. If not… RAC 3/76200920(c) 2009 Revenue Strategies

21. References “RAC Demo Report”, CMS, Mar 2008 “RAC Demo – Update”, CMS, Sep 2008 “10 Critical Actions to Minimize RAC Recoupment”, Forney & Phillips, HLF, 2009 “RAC Update”, IMA Consulting Newsletter, Jan 2009. 3/762009(c) 2009 Revenue Strategies21

22. Contact Info… Stephen Forney, MBA, CPA, FACHE, FHFMA VP - Margin Development Ardent Health Services Nashville, TN 615-296-3054 stephen.forney@ ardenthealth.com Bill Phillips, FACMC, CHC Associate Professor Health Services Mgt. Geo Washington Univ. & VP & Chief Revenue Off Revenue Strategies 786-371-6493 billinfll@juno.com 3/76200922(c) 2009 Revenue Strategies