What is the RCD?
The Review Choice Demonstration (RCD) project for Inpatient Rehabilitation Facilities (IRF) seemed like a pipe dream when the Centers for Medicare & Medicaid Services (CMS) started discussing it before the Pandemic. The goal of the RCD is to reduce the burden on providers demonstrating compliance with Medicare IRF rules. The RCD started out slowly, but is currently in full swing in four states:
- Alabama (effective August 2023)
- Pennsylvania (effective June 2024)
- Texas (effective March 2026)
- California (effective May 2026)
Georgia and Tennessee are slated for full implementation of the RCD project on December 31, 2026, with the program officially becoming effective on January 1, 2027. This expansion falls under MAC Jurisdiction J (JJ) for Palmetto GBA. Future expansions are planned for all states falling under MAC jurisdictions JL, JH, and JE, however specific implementation dates have not yet been announced.
If your organization is listed and bills as an IRF or an Inpatient Rehabilitation Unit (IRU) and is on the list for RCD implementation, your organization will have to choose either the Pre-claim review or the Postpayment review by the deadline set for your jurisdiction. If the deadline is missed, most Medicare Administrative Contractors (MAC) will automatically sign you up for the Postpayment Review.
Choice 1 – Pre-claim review is a process in which 100% of claims are reviewed prior to the final claim being submitted for payment. During this process, a request for provisional affirmation of coverage is submitted for review before the final claims are submitted. Pre-claim review provides reasonable assurance that applicable coverage, payment, and coding requirements have been met before the final claim is submitted.
Choice 2 – Postpayment review is a process in which 100% of claims are reviewed after the final claim has been submitted and paid. The IRF will follow the standard intake, service, and billing procedures, and the claims will be paid according to normal claim processes and CMS guidelines.
After the claim is paid, your MAC will send an additional documentation request (ADR) letter requesting the IRF to submit medical records for review. The MAC will conduct the review according to its standard postpayment review process. If a claim is denied, the MAC will follow the standard payment recoupment procedure. The IRF retains all appeal rights for denied claims.
Tips on the RCD
LW Consulting, Inc. (LWCI) has experience assisting IRFs in preparing for the implementation of the RCD. By providing an external review of records, we have identified reoccurring issues that organizations should review.
- Confirm there is adequate supporting documentation is included to show the efficacy of the inpatient admission, if you are admitting patients from home for specialized programs such as prosthetic training or second-chance stroke rehab.
- Review and ensure all dates are within the guidelines outlined in the Medicare Benefit Policy Manual (MBPM) for pre-admission screens, team conferences, and physician H & P.
- Verify that documentation is patient-specific and includes function to support the rationale for medical necessity for admission.
If your organization chose the postpayment review, or missed the choice deadline, be on the lookout for those ADRs. You WILL get an ADR for every admission! Once the ADRs come in, you will have a limited time to submit all the supporting documentation to demonstrate the medical necessity of the admission.
If you would like an external review that is not CMS, LWCI’s experts. would be glad to provide feedback.
LW Consulting, Inc. (LWCI) offers a comprehensive range of services to assist your organization in maintaining compliance, identifying trends, providing education and training,  or conducting documentation and coding audits. For more information, contact LWCI to connect with one of our experts!
