General Question for the Week of January 16, 2017

General Compliance Question of the Week

Question:

How are RACs paid?

Answer:

Recovery audit contractors (RACs) are paid on a contingency fee basis. The amount of the contingency fee is a percentage of the improper payment recovered from, or reimbursed to, providers. The RACs negotiate their contingency fees at the time of the contract award. The base contingency fees range from 9 to 12.5 percent for all claim types, except durable medical equipment (DME). The contingency fees for DME claims range from 14 to 17.5 percent. The RAC must return the contingency fee if an improper payment determination is overturned at any level of appeal.

Disclaimer: Every reasonable effort was made to ensure the accuracy of this information at the time it was published. However, due to the nature of industry changes over time we cannot guarantee its validity after the year it was published.