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Recovery Audit

What Is the Recovery Audit Program?

The mission of the Recovery Audit Program is to detect and correct past improper payments made on health care claims for services provided to Medicare beneficiaries. The goal is to help CMS and the MACs implement actions that will prevent future improper payments.

What Are the Recovery Auditors' Responsibilities?

Recovery Auditors review claims on a postpayment basis using the same Medicare policies as MACs:

  • NCDs
  • LCDs, and
  • CMS manuals/regulations

To ensure accuracy, Recovery Auditors are required to employ nurses, therapists, certified coders and a contractor medical director.

Recovery Auditors use two review processes:

  • Automated (no medical record needed)
  • Complex (medical record required)

To minimize provider burden, Recovery Auditors may look back only three years from the date the claim was paid; however, Recovery Auditors are unable to review claims paid prior to 10/1/2007.

Who Are the Recovery Auditors?

Recovery Auditor States Serviced
Region 1: Performant Recovery, Inc. CT, IN, KY, MA, MD, ME, MI, NH, NY, OH, RI, VT
Region 2: Cotiviti, LLC.
Region 3: Cotiviti, LLC.
AL, FL, GA, NC, SC, TN, VA, WV, Puerto Rico and U.S. Virgin Islands
Region 4: HMS Federal Solutions
AK, AZ, CA, DE, HI, ID, MD, MT, ND, NJ, NV, OR, PA, SD, UT, WA, WY, Guam, American Samoa and Northern Marianas
Region 5: Performant Recovery, Inc. Nationwide for DMEPOS/HHA/Hospice

How Will I Know When a Payment Determination Has Been Issued?

When a Recovery Auditor finds that improper payments have been made, they will submit claim adjustments to your MAC. The MAC will perform the adjustments based on the Recovery Auditor’s review, and issue an automated demand letter to the provider. If you agree with the Recovery Auditor's determination, National Government Services will issue the recoupment offset on your remittance advice (unless you have submitted a check or a valid appeal). Recovery Auditor recoupment offsets will be identified on your remittance advice with the following ANSI remark code and message:

N432: Adjustment based on recovery audit

What Are My Options When I Receive the Recovery Auditor Demand Letter?

If you agree with the Recovery Auditor’s determination you can:

  • repay the overpayment amount by check;
  • allow National Government Services to recoup the overpayment from future remittance payments; or
  • request or apply for an extended payment plan.

If you do not agree with the Recovery Auditor's determination you may use the Medicare appeals process. Note that you must file an appeal within 120 days of the Recovery Auditor's determination.

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