Feds double down on improper payments with new RAC contracts

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The Centers for Medicare & Medicaid Services has awarded five new contracts for its recovery audit contractor program, a move one expert suggests reflects the agency's renewed efforts to cut improper payments in Medicare.

Four companies received the new contracts to identify and correct improper Medicare Part A and Part B payments through post-payment reviews, CMS said Monday. A fifth contract was given to a company to review payments for medical equipment, home health and hospice claims.

The RAC program has recovered an estimated $10 billion in improper payments, and extended Medicare's solvency by two years, according to the Council for Medicare Integrity. In spite of its successes, the program has also drawn provider ire for saddling the industry with more administrative duties and adding on to the growing appeals backlog, Modern Healthcare reported.

Still, the new contracts signal the agency is serious about cracking down on improper payments, said Kristin Walter, spokeswoman for the Council.

“With Medicare's solvency in serious jeopardy due to a loss of more than $150 billion in taxpayer dollars over the last three years, renewing the work of the RAC program to balance the program's checkbook is essential to protecting Medicare's future fiscal health,” Walter said in a statement. “Now, auditors can to get back to the important work of reducing improper payments, which ultimately protects American seniors' long-term access to healthcare.”