Medicaid RAC Improvement Act of 2026
Sponsored By: Senator Scott, Rick [R-FL]
Introduced
Summary
Improve Medicaid payment integrity by strengthening how States audit and recover Medicaid overpayments and by expanding those audits into managed care.
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- States would file annual, detailed reports on their Medicaid Recovery Audit Contractor programs, explain the methodologies behind audit limits or exclusions, and face a statutory cut-off for some RAC exception approvals through 2028. RAC contracts would limit audits to the current fiscal year and up to four prior fiscal years.
- Medicaid managed care plans and prepaid health plans would be included in RAC reviews and would either agree to a payment integrity review period up to 18 months after a claim or allow a State RAC contractor to conduct the review. States must put these contract assurances in place by January 1, 2028.
- The bill would boost transparency and oversight. It directs the Secretary to deliver an initial report to Congress by December 31, 2027 and annual updates, orders a study on barriers to State participation including contingency fee structures and startup costs, and creates a five-year demonstration to increase State participation in RAC programs.
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Bill Overview
Analyzed Economic Effects
4 provisions identified: 2 benefits, 0 costs, 2 mixed.
New annual Medicaid audit reports
If enacted, the Secretary would send Congress an annual report on the Medicaid RAC program. The first report would be due not later than December 31, 2027 and annually thereafter. The reports would include State‑level totals for overpayments recovered and underpayments, pre‑payment savings, appeals and settlement rates, top error‑reduction initiatives, and the Secretary's recommendations. States would also submit annual reports identifying the reviewing entity for each payment stream, and the Secretary would compile those reports and send recommendations to Congress.
Limit and monitor RAC exceptions
If enacted, the bill would stop authorizing RAC exceptions after December 31, 2028. The Secretary would issue rules within 180 days to notify States with approved exception SPAs about their expiration dates and say approvals will not be extended after 2029. States with approved RAC exception SPAs would also have to file annual, detailed reports explaining their RAC program and why any audit limits or exclusions exist.
More Medicaid managed-care audits
If enacted, the bill would explicitly let RAC reviews include Medicaid managed care and prepaid plans. States would have to assure by January 1, 2028 that contracts let plans elect a payment‑integrity review (no longer than the lesser of 18 months after payment or the contract term) or let a State RAC contractor do the review. Beginning 120 days after enactment, State‑RAC contracts would let audits look back four fiscal years.
Study and demo to expand RACs
If enacted, the Secretary would study barriers to State RAC programs and report to Congress within 1 year. The study would examine contingency fees, multi‑State contracts, and start‑up costs. Based on that study, the Secretary would start a 5‑year demonstration within 2 years to increase State RAC adoption, send an interim report 90 days after it starts, and a final report 180 days after it ends.
Sponsors & CoSponsors
Sponsor
Scott, Rick [R-FL]
FL • R
Cosponsors
There are no cosponsors for this bill.
Roll Call Votes
No roll call votes available for this bill.
View on Congress.gov