OIG Report Recommends More Attention by CMS to Recovery Audit Contractor Program

The Centers for Medicare and Medicaid Services’ (CMS) oversight of its recovery audit contractors (RACs) and measures to address improper payment vulnerabilities identified by RACs are insufficient, says a report from the U.S. Department of Health and Human Services’ Office of Inspector General (OIG). The RAC program went into effect in late 2009 to assist the agency in identifying improper payments made by the Medicare program and in recouping those payments. RACs receive a percentage of any payments recovered or returned to providers. In its report, OIG found that even though the RAC audits helped CMS identify 46 vulnerabilities that resulted in improper payments in fiscal years 2010 and 2011, the agency had only put measures in place to address 28 of the vulnerabilities. OIG also found that even though the RAC program had referred six potentially fraudulent claims in fiscal years 2010 and 2011 to CMS, the agency had not taken action on the referrals.