The Affordable Care Act (ACA) requires Medicaid agencies to contract with Recovery Audit Contractors (RACs) for Medicaid program integrity purposes (Federal Register: Medicaid Program; Recovery Audit Contractors). OMIG contracts with a vendor to facilitate these activities to reduce improper payments through detection and collection of overpayments, the identification of underpayments, the reporting of suspected fraudulent and/or criminal activities, and the implementation of actions that will prevent future improper payments. This is accomplished primary through:
- Claim Selection and Improper Payment Recovery
- Underpayment Identification
- Overpayment Identification
Claim Selection and Improper Payments
The Vendor identifies providers that have received payments from the State in error, duplicate payments or benefits, incorrect payment amounts, non-covered services, incorrectly coded claims, reimbursement errors (both excessive and insufficient), coverage or eligibility errors, or payments made for services not ordered or otherwise performed, or are otherwise ineligible under the law, rules, terms or conditions of the New York Medicaid program.
Improper payments in a targeted review may be determined via an automated review which is determined at the system level, without a human review of the medial record or supporting documentation, or via a complex review, using human review of medical records, vendor records, and other supporting documentation.
Underpayment Identification
The Vendor reviews each claim line and considers all possible occurrences of an underpayment for all provider types. Once identified, the Vendor will inform the provider of the underpayment and have the provider sign an OMIG-approved agreement form which will be sent to OMIG. The provider is responsible for recovering the underpayments.
Overpayment Identification
After the Vendor performs reviews, potential overpayments are identified. A preliminary findings letter is sent to the provider detailing each claim line and discrepancy. The provider is given the opportunity to submit additional documentation in regard to the potential discrepancy. Final letters are then sent to providers informing of them of the results. If the overpayments stands, and provider is in agreement with the findings, they may repay by check or void/adjustment through the Medicaid Management Information System (MMIS), offsetting future payments.
Please see the following links for additional information: