CMS announced that on February 4, 2009, the parties involved in the protests of the award of the Recovery Audit Contractor (RAC) contracts settled
the protests. The settlement means that the stop work order has been lifted and CMS will now continue with the implementation of the RAC program.
Therefore, CMS will soon be rolling out its national RAC audit program, which is the outgrowth of a pilot program in which CMS contracted with
independent auditors to identify Medicare overpayments and underpayments to health care providers. As detailed in
our e-Brief of January 27, the implementation date
for the national RAC program has been in doubt because of stop work order issued due to bid protests that were filed in late 2008 by unsuccessful
bidders for the RAC contracts. Once national implementation begins, Texas health care providers can expect to be subjected to another layer of
scrutiny regarding Medicare payments.
The RAC in each jurisdiction is as follows:
- Region A: Diversified Collection Services (DCS)
- Region B: CGI
- Region C (includes Texas): Connolly Consulting, Inc.*
- Region D: HealthDataInsights, Inc.
All correspondence, websites, and call centers will be in the name of the RACs above. However, in a new development, the four RACs will contract
with subcontractors to supplement their efforts. PRG-Schultz, Inc. will serve as a subcontractor to HDI, DCS, and CGI in regions A, B, and D.
*Viant Payment Systems, Inc. will serve as a subcontractor to Connolly Consulting in region C. Each subcontractor has negotiated different
responsibilities in each region, including some claim review.
Additional states will be added to each RAC region in 2009. Under the RAC Expansion Schedule previously issued by CMS, Texas is scheduled to be
added to RAC Region C on March 1, 2009. In light of the lifting of the stop work order, it appears likely that the scheduled addition of Texas
to Region C will proceed as scheduled. Therefore, Texas health care providers should expect to see RAC activity as soon as March 2009.
If you have any questions regarding this e-Alert, please contact Carla Cox at 512.236.2040 or at cjcox@jw.com.
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