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Recovery Audit Contractor (RAC)

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Provider Outreach Training

December 16, 2022

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Recovery Audit Contractor (RAC) Program
What is the RAC program?
Pursuant to Section 42 CFR 455 Subpart F of the Federal Code of Regulations, each state must contract with a contingency-fee-based vendor to review provider claims. The purpose of the review is to reduce improper Medicaid payments through the efficient detection and collection of overpayments, the identification of underpayments and the implementation of actions that will prevent future improper payments.

Who is the HSD RAC Contractor?
In 2019, HSD awarded Health Management Systems, Inc., (HMS) the contract to act as its Recovery Audit Contractor (RAC). For more information on Health Management Services, Inc. (HMS) and RAC related resources for providers please go to:

RAC Audit Scope
The purpose of the RAC is to reduce improper payments while also presenting billing education opportunities to providers to improve the accuracy of claims submitted to HSD for reimbursement. Under the RAC, all provider types will be audited. The RAC vendor will audit the following types of claims: Medicaid and CHIP fee-for-service and Managed Care.

The RAC lookback period is three years (36 months) from the Paid Date of the Medicaid claim. Claims prior to July 1, 2020 will not be included in the RAC reviews or lookback period.

HMS will conduct post-payment claims reviews of provider-submitted Medicaid paid claims to determine whether services were provided, medically necessary, coded correctly, and properly paid or denied.

Are providers required to cooperate with the RAC?
Providers are required by Section 1902(a)(27) of the Social Security Act and the Medicaid Provider Participation Agreement to:
Retain records necessary to disclose the nature and extent of services provided to recipients.
Maintain records that fully substantiate or verify claims submitted for payment.
Submit records to federal and state governments upon request.

What happens if the provider does not cooperate?
Any claims for which documentation is not received upon request shall be deemed to be overpayments subject to recovery regardless of whether services were or were not provided. The Department will recover the overpayments as indicated by the Medicaid Provider Participation Agreement.

Where can I find out more information and who do I contact with RAC questions?
For questions related to the RAC program or provider audits, please contact HMS at or call 1-866-590-5598

For additional information, please contact RAC Program Manager, Ashley Cooper at