Medicaid Recovery Audit Contractor

Overview

The Affordable Care Act (ACA) requires Medicaid agencies to contract with Recovery Audit Contractors (RACs) for Medicaid program integrity purposes. Since 2011, OMIG has contracted with Health Management Systems, Incorporated (HMS) to reduce improper payments through the 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
  • Self-Disclosure Recovery

Claim Selection and Improper Payments

HMS 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

HMS reviews each claim line and considers all possible occurrences of an underpayment for all provider types. Once identified, HMS 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 HMS 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.

Self-Disclosure Recovery

HMS recovers self-disclosures initiated through provider contact, the HMS self-disclosure portal or through OMIG referral. Providers are required to self-disclosure overpayments with 60 days of identification under section 6402(a) of the Affordable Care Act (ACA) of 2010 and self-disclosure is also a mandatory part of New York’s compliance programs under Title 18 of the New York Code of Rules and Regulations (NYCRR) Section 521. Details on self-disclosure can be found on this website. At this site, you will find the process to be followed by HMS as well as a checklist of required information for the provider’s submissions. HMS will develop statewide recovery projects based on the overpayment scenarios detailed in the self-disclosures.