CHA News Article

OIG Report Finds RAC Oversight Needs Improvement

The Office of Inspector General (OIG) has released a report regarding Medicare Recovery Audit Contractors (RAC) and the Centers for Medicare & Medicaid Services’ (CMS) inaction in addressing improper payments, referrals of potential fraud and performance. The OIG report identified vulnerabilities in CMS’ oversight of its RACs; specifically, the report found CMS’ performance evaluations did not include metrics to evaluate RACs’ performance on all contract requirements. The report also found that in 2010 and 2011, RACs identified half of all claims they reviewed as having resulted in improper payments, totaling $1.3 billion. CMS took corrective actions to address the majority of vulnerabilities it identified in 2010 and 2011. However, it did not evaluate the effectiveness of these actions. Therefore, the OIG report predicts a high volume of improper payments may continue.

CHA continues to work on behalf of members by advocating for legislation that would improve the RAC program, and encourages members to contact their representatives about cosponsoring H.R. 1250, the Medicare Audit Improvement Act. The complete OIG report is available at