Corporate Compliance

CMS releases final rule on Medicaid RACs

Compliance Monitor, September 21, 2011

In February, the Centers for Medicare and Medicaid Services (CMS) delayed its expected April 1 implementation of the Medicaid recovery audit contractors (RACs) final rule.

CMS finally released its Medicaid RACs final rule September 14.

The new initiative, modeled after the Medicare RAC program, aims to fight waste and fraud in Medicaid and will save taxpayers an estimated $2.1 billion over the next five years, according to a press release from the Department of Health and Human Services (HHS). Approximately $900 million will be returned to states.

“Today we are building on an already successful program that targets improper payments in our healthcare programs and recovers those dollars, making Medicare and Medicaid more reliable and responsible,” HHS Secretary Kathleen Sebelius said in the September 14 press release. “We simply can't afford to see even one penny of our healthcare dollars wasted and expanding this program will help us reach that goal."

The rule itself implements section 6411 of the Affordable Care Act . The rule provides guidance to individual states related to federal and state funding of state start-up, operation, and maintenance costs of Medicaid RACs, and the payment methodology for state payments to Medicaid RACs.

Read more on the Revenue Cycle Institute.

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