SB 25-314

Senate Bill 25-314 establishes a program in Colorado where the Department of Health Care Policy and Financing can hire an outside company, called a Recovery Audit Contractor (RAC), to review Medicaid claims from healthcare providers. The RAC can only look back up to three years for potential overpayments or errors. If issues are found, the provider gets a detailed report explaining any mistakes and how they were calculated. Providers have opportunities to discuss these findings before formal appeals begin. Additionally, the bill adjusts funding in the department's budget by shifting money from recoveries and recoupments to a new recovery audit contractor fund. Since the status is "signed," this means the governor has approved the bill, making it law.

Official Summary

The act allows the department of health care policy and financing (department) to, on behalf of the department, contract with a recovery audit contractor (RAC) vendor to conduct RAC audits of medicaid providers (providers). RAC audits may only review claims that are no more than 3 years past the expiration date of the timely filing period. The department may only review claims that fall outside of this 3-year time frame if required by a federal audit. The act limits the number of audits a provider may undergo each year and the number of medical records that can be requested for a given audit. If the RAC vendor identifies preliminary findings during the RAC audit, the RAC vendor must send the provider a report detailing the preliminary findings, the rationale for the preliminary findings, and the methodology for how any overpayments were calculated and determined. The act allows a provider that received preliminary findings following a complex audit to request an exit conference to discuss the preliminary findings with the RAC vendor and the department to resolve the concerns detailed in the preliminary findings prior to undergoing an informal reconsideration of the preliminary findings. A provider is required to participate in an informal reconsideration before filing a formal appeal regarding the department's findings during an RAC audit. The department is required to submit an annual report to the joint budget committee containing information about the RAC audits conducted and the department's involvement in those RAC audits. The act, in the department's budget for medical and long-term care services for medical-eligible individuals, decreases the cash funds appropriation from recoveries and recoupments by $20,900,588 and increases the cash funds appropriation from the recovery audit contractor recoveries cash fund by $20,900,588. (Note: This summary applies to this bill as enacted.)

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