The Centers for Medicare and Medicaid Services (CMS) published proposed rules on November 10 on implementing Medicaid Recovery Audit Contractor (RAC) programs in accordance with section 6411 of the Affordable Care Act (ACA). The proposed rules address funding for program start-up, operations, contingency fee payments to contractors from recoveries of overpayments, provider appeals procedures, and coordination with other audit programs, program integrity activities, and law enforcement officials based on interagency memoranda of understanding. The proposed rules say that states must establish Medicaid RAC programs via state plan amendments by December 31, 2010 and that the programs must be fully operational by April 1, 2011. States may contract with one or more qualified Medicaid RAC contractors as defined in the proposed rules. Current rules on prompt refunding of the federal share of Medicaid overpayments to CMS will apply to Medicaid RACs. Contingency fee payments under the Medicaid RAC program are expected to be comparable to such payments under the existing Medicare RAC program, which do not exceed 12.5 percent of recoveries and currently average 10.86 percent. The USDHHS Office of the Inspector General (OIG) indicates that Medicare RACs already have identified over $1 billion in Medicare overpayments. CMS estimates that potential net savings to Medicaid will reach $310 million in 2014 and $330 million in 2015. Comments on the proposed Medicaid rules must be submitted to CMS by January 10, 2011.
About Tom Entrikin
A former policy specialist with the U.S. Health Care Financing Administration (now Centers for Medicare & Medicaid Services (CMS)), Tom Entrikin has vast experience providing technical assistance to states on Medicaid eligibility, coverage, and reimbursement; provider certification and enrollment; program integrity; recovery of third party liabilities; Medicaid Management Information System (MMIS) performance specifications and operations; interagency agreements; contracts with managed care organizations; and Medicaid waiver programs.
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