The Recovery Audit Contractors (RAC) Payment Error Program continues to be a growing concern to healthcare providers across the country. As one of our core services, PPS provides proven RAC defense by our team of previous RAC contractors, physicians with case management and ALJ hearing experience and a former Administrative Law Judge.

PPS’ RAC services include: determining the viability of an appeal, management of denial letters and writing appeal letters. We currently have a greater than 75% success rate in overturning Level II Appeals. PPS will work in concert with or take the lead in RAC Appeals and tailor our process on an individual or case-by-case basis for your needs and skill level. We work with your legal team, if engaged, to provide the necessary expertise and documentation to support your appeals position.

PPS’ RAC ProActive module prepares facilities for RAC reviews by examining the most prominent historical and client specific areas of RAC investigation for both inpatient and outpatient cases. PPS understands that preparing for RAC is among the most important issues facing revenue integrity professional, and offers its assistance to facilities by providing information and advice to focus the preparation process. The objective of these services is to identify potential payment issues pursuant to RAC audits, in advance, so that any issues can be uncovered and managed before the review begins.


Prospective Payment Specialists has designed a multifaceted service that will identify potential exposure to repayment liabilities under Medicare’s Recovery Audit Contractor Program. Each component of our service can be conducted as a stand-alone review, in combination with any number of other components, or a comprehensive engagement that includes all sections.

PPS can conduct a comprehensive Simulation Medicare RAC review of inpatient and outpatient claims, and medical records, to identify potential issues as identified by the current RAC efforts.

  • Comprehensive DRG review
  • Identify and review inpatient cases with the highest probability of DRG change
  • Target 12 key DRGs based on current RAC audit methodology
  • Perform inpatient coding audits to validate DRGs
  • Review single CC DRGs
  • Review discharge disposition code
  • Review of Medicare one day length of stays
  • Review all medical one day stays (excluding those with a discharge disposition of expired or transfer to other acute care hospital) for validation of the appropriate patient status; inpatient vs. observation
  • Validate medical necessity utilizing InterQual criteria
  • Review of Skilled Nursing Facility (SNF) Transfers
  • Identify and review the medical necessity of three day stays with a transfer to a skilled nursing facility (SNF) for large volume DRGs with a large proportion of three-days stays
  • Charge assignment validation
  • Medical Record code assignment review
  • Chargemaster review of CPT/HCPCS/Revenue codes to identify coding errors
  • Charge protocols
  • OPPS service review
  • Observation medical necessity review
  • Non-covered services
  • Coding errors
  • Chargemaster code errors
  • Point of Service
  • Medically unlikely edit review (OCE edits)
  • Review of items eligible for Pass Through payments (drugs, pharmaceuticals, supplies, DME, prosthetic and orthotics)
  • Verify correct units of services are billed (i.e. blood transfusions, therapy services, drugs and pharmaceuticals)

PPS’ team of previous RAC contractors and our Administrative Law Judge will be able to help your facility reveal potential exposures before the RACs do.