866-879-5028 Get a Quote


Anesthesia and RAC

Anesthesiology practices are predominantly susceptible to Medicare audits because of the exceptional complexities of the billing process when it comes to time calculation, coding, and other areas.

The federal government’s Recovery Audit Contractors (RAC) program fully understands this vulnerability and is making the most of it, with unrelenting audits to recoup any money that the government deems was issued improperly.

The federal government has instituted the RAC program by contracting with non-governmental firms to provide audits and setting up an incentive plan whereby the auditors only get paid when they identify billing mistakes within a practice and recoup Medicare overpayments. This sets the stage for a very aggressive auditing advance, with the federal False Claims Act setting penalties as high as $11,000 per claim, plus three times the claim amount, plus legal fees.

Because the Tax Relief and Health Care Act of 2006 made the RAC program permanent, these aggressive audits will only continue over the coming years. Indeed, the RAC program is in practice in all 50 states from 2011.

We focus on some of the most vulnerable areas in anesthesiology billing and coding. Its purpose is to provide a reference guide and reminder to ensure all bases are covered when it comes to proper billing and appropriate reimbursement for an anesthesiology practice.

Common Audit Problems

A concise summary of the billing areas that are commonly cited as problems is included below. These billing areas are frequent tentative blocks to ensuring an anesthesiology practice is reimbursed fully and appropriately for its work.


  • Definition of start and stop time
  • Rounding off time
  • Lack of monitoring to support the time submitted on the claim
  • Consistently billing five minutes prior to “in room” time and 10 minutes after “out of room” time
  • Routinely including ancillary services in anesthesia time


  • Incorrect codes entered for procedures
  • Missing base units due to lack of proper documentation of the procedure
  • Up coding or using a higher code in order to bill more units

Medical direction

  • Medical direction documentation areas
  • Pre-anesthesia assessments not done
  • Medically directing more rooms than allowed
  • Medical director not immediately available – relief, breaks, leaving the area
  • Frequent monitoring or not documenting the monitoring
  • Presigning records
  • Performing a case while medically directing another

Ancillary services

  • Procedures used primarily for post-op pain
  • Failure to document that the service was requested by the surgeon
  • Inadvertent dual management with surgeon
  • Billing for the ancillary services during anesthesia time OB anesthesia
  • Inconsistency in use of billing methods, e.g., total time with cap, actual face time, flat fee, etc.
  • Inadequate documenting of face-to-face time
  • Billing under the wrong provider
  • Billing all OB services as emergencies

Incidental services

  • Catheter placement, etc., or billing if an additional catheter is placed
  • Coding an additional service if more than one monitoring device is used with the same “stick.” Examples include arterial lines, CVPs, Swan-Ganz catheters, blocks for pain management, TEE (Transesophageal Echocardiography)

Incidental services with time

  • Because incidental services are billed as a flat fee with CPT code, there can be no time associated with them in the billing calculation


  • Breaking services out and billing as separate services when they should all be included in one CPT code

MAC vs. General vs. TIVA Anesthesia

  • There continues to be confusion over monitored anesthesia care vs. general anesthesia vs. total IV Anesthesia