Revenue Cycle

CMS laying groundwork for Medicaid RACs

Recovery Auditor Report, September 16, 2010

In a sign that can be viewed as the first step toward Medicaid RAC implementation, CMS released September 10 an information collection form and supporting documents for contractors for Medicaid plans.The release of formalized information comes as no surprise, according to Elizabeth Lamkin, MHA, president of Dalzell Consulting Group, Inc., in Hilton Head, SC.

“As we learned from the Medicare RAC demonstration project, the RACs collected $1.3 billion at a cost of 20 cents on the dollar,” she says. “There is a huge incentive to expand the RAC program to Medicaid.”

The documents within draft form CMS-10343 would be used by state Medicaid plans to attest they’ve contracted with a contingency fee auditor. The forms list several criteria for the RAC expansion, including provisions related to payment of the Medicaid RACs, appeal of adverse Medicaid RAC determinations, and coordination of Medicaid RAC activity with other reviewers and entities (e.g., the Medicaid integrity program).

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