Healthcare Business News

Proposed rule offers states pay options for Medicaid RACs

By Jessica Zigmond
Posted: November 5, 2010 - 6:00 pm ET

In a proposed rule regarding new Medicaid recovery audit contractors, the CMS said states will be allowed to determine whether to pay their Medicaid RACs on a contingency basis or under some other fee structure that identifies underpayments.

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This year's Patient Protection and Affordable Care Act requires states to establish Medicaid RAC programs by submitting state plan amendments to the CMS by Dec. 31. The proposed regulation also highlights the requirements that states must meet, and the federal contribution that CMS will provide to help in funding state RAC programs. Under the regulation, a state may use its current administrative appeals process or may change its process for appeals related to Medicaid RACs.

“All fees paid to the Medicaid RACs must come from amounts recovered after all available appeals have been exhausted,” the agency said in its announcement. The rule also proposes that states and Medicaid RACs coordinate with other contractors and entities auditing Medicaid providers and with state and federal law enforcement agencies.



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