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Monday, June 30, 2025

Understanding the RACs and FCAs - MedLearn Publishing

Let me open by saying I am so happy to be here. For those of you who watched the live version of last week’s Monitor Mondays, I suffered a seizure during my segment.

I am so thankful to Dr. (Ronald) Hirsch for recognizing the signs and calling my administrative assistant, who normally would never interrupt my presentation, but did for his call. She, in turn, called 911. Help came, and I am here.

As we all know, Recovery Audit Contractors (RACs) are private contractors hired by the Centers for Medicare & Medicaid Services (CMS) to detect and correct improper payments within the Medicare and Medicaid programs. Their primary responsibility is to identify overpayments, underpayments, and incorrect coding.

“Overpayments” refer to any payment made by Medicare or Medicaid that exceeds the amount that should have been paid, based on the services provided. RACs do this by reviewing billing records and comparing them to guidelines outlined by CMS and other relevant authorities.

The question I present today is this: how is an alleged overpayment distinct from an alleged violation of the False Claims Act (FCA), which invokes higher, triple penalties? When you think about it, any alleged overpayment is also an alleged violation of the FCA. But a RAC cannot adjudicate FCA accusations. The variance lies within the the individual entity that is conducting, and the provider’s intent.

RACs conduct audits through a variety of mechanisms, including automated reviews (for clear errors...



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