Senate Bill 25-314 Rerevised

A Bill for an Act

• Page 1, Line 101Concerning changes to the recovery audit contractor

• Page 1, Line 102program, and, in connection therewith, making and

• Page 1, Line 103reducing an appropriation.

Bill Summary

(Note: This summary applies to this bill as introduced and does not reflect any amendments that may be subsequently adopted. If this bill passes third reading in the house of introduction, a bill summary that applies to the reengrossed version of this bill will be available at http://leg.colorado.gov/.)

Joint Budget Committee. The bill allows the department of health care policy and financing (state department) to contract with a recovery audit contractor (RAC) vendor to conduct RAC audits of medicaid providers (providers) on behalf of the state department.

RAC audits may only review claims that are no more than 3 years past the date of the expiration of the timely filing period. The bill allows the state department to review claims that fall outside of this 3-year time frame only if required by a federal audit.

The bill limits the number of audits a provider may undergo each year and limits the number of medical records that can be requested for a given audit.

If the state department identifies preliminary findings during the RAC audit, the state department 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 bill allows a provider that received preliminary findings following a complex audit to request an exit conference to discuss the preliminary findings with the state department in an effort to resolve the concerns detailed in the preliminary findings prior to undergoing an informal reconsideration of the preliminary findings.

The bill requires a provider to participate in an informal reconsideration before filing a formal appeal regarding the state department's findings during a RAC audit.

The bill, in the department of health care policy and financing for medical and long-term care services for medical-eligible individuals budget, decreases the cash funds appropriation from recoveries and recoupments by $20,900,588 and the cash funds appropriation from the recovery audit contractor recoveries cash fund is increased by $20,900,588.

• Page 2, Line 1Be it enacted by the General Assembly of the State of Colorado:

• Page 2, Line 2SECTION 1.  In Colorado Revised Statutes, 25.5-4-301, amend (3.5)(c); repeal (3)(a)(IX); and add (3.3) as follows:

• Page 2, Line 325.5-4-301.  Recoveries - overpayments - penalties - interest -

• Page 2, Line 4adjustments - liens - review or audit procedures - cash fund - rules -

• Page 2, Line 5definitions - repeal. (3) (a)  A review or audit of a provider is subject to the following procedures:

• Page 2, Line 6(IX)  For audits conducted pursuant to 42 CFR 455.506, at least

• Page 2, Line 7quarterly, the state department shall publish on its website an audit

• Page 2, Line 8activity report detailing current and recently completed audits and reviews

• Page 2, Line 9and summaries of the findings of such audits and reviews, including the

• Page 3, Line 1number and amounts of overpayments and underpayments found, the

• Page 3, Line 2number and results of appeals, the amounts collected, and the error rates

• Page 3, Line 3identified. At least quarterly, the state department shall conduct trainings

• Page 3, Line 4for providers and hold stakeholder meetings regarding audits and reviews.

• Page 3, Line 5In addition, when the state department enters into contracts pursuant to

• Page 3, Line 6this subsection (3)(a), the state department shall publish on its website a

• Page 3, Line 7copy of the contract, scope of work, and information regarding supervision of contractor deliverables.

• Page 3, Line 8(3.3) (a)  As used in this subsection (3.3), unless the context otherwise requires:

• Page 3, Line 9(I)  "Automated audit" means a RAC audit that reviews a

• Page 3, Line 10provider's application of coding rules and does not require a provider to submit medical records to be audited.

• Page 3, Line 11(II)  "Complex audit" means a RAC audit that requires a

• Page 3, Line 12provider to submit medical records to be audited, which are

• Page 3, Line 13individually reviewed by a representative of the state department or the state department's RAC vendor.

• Page 3, Line 14(III)  "Denial rate" means the percentage of reviewed

• Page 3, Line 15claims ultimately determined to involve improper payments

• Page 3, Line 16after all administrative processes are complete, including the resolution of an appeal.

• Page 3, Line 17(IV)  "RAC audit" means a recovery audit contractor

• Page 3, Line 18audit conducted pursuant to the federal "Social Security Act", 42 U.S.C. sec. 1396a (a)(42)(B).

• Page 3, Line 19(V)  "RAC vendor" means a vendor who meets the

• Page 3, Line 20requirements of 42 CFR 455.508 and contracts with the state

• Page 3, Line 21department to perform recovery audit contractor audits of providers on behalf of the state department.

• Page 4, Line 1(b)  The state department may solicit the services of a RAC

• Page 4, Line 2vendor through a contract issued pursuant to the

• Page 4, Line 3"Procurement Code", articles 101 to 112 of title 24, and pursuant

• Page 4, Line 4to the federal requirements detailed in 42 CFR 455.508, for the

• Page 4, Line 5purpose of conducting RAC audits of providers to identify possible medicaid overpayments and underpayments.

• Page 4, Line 6(c) (I)  The contract described in subsection (3.3)(b) of this

• Page 4, Line 7section must state that the RAC vendor's compensation is

• Page 4, Line 8contingent upon the amount of overpayments the state recovers

• Page 4, Line 9from a provider. At the expiration of the current contract

• Page 4, Line 10between the state department and the RAC vendor, the state

• Page 4, Line 11department shall establish contingency fee rates based on

• Page 4, Line 12market rates determined by the results of a competitive

• Page 4, Line 13procurement process and may negotiate lower rates as the

• Page 4, Line 14market provides, with contingency rates not to exceed sixteen

• Page 4, Line 15percent of recovered payments. The state department shall

• Page 4, Line 16ensure that the contingency fee requirements are adhered to

• Page 4, Line 17through effective monitoring and enforcement of the RAC

• Page 4, Line 18vendor's performance. For contracts entered into after the

• Page 4, Line 19expiration of the contract that established contingency fee

• Page 4, Line 20rates for RAC vendor payments, the state department shall

• Page 4, Line 21structure the RAC vendor compensation based on a tiered

• Page 4, Line 22payment system that corresponds to the required work unless

• Page 4, Line 23doing so conflicts with federal directives in medicaid guidance

• Page 4, Line 24pursuant to 42 CFR 455, subpart F, or results in an unfavorable

• Page 4, Line 25impact to the state's general fund.

• Page 5, Line 1(II)  When the state department enters into a contract

• Page 5, Line 2pursuant to subsection (3.3)(b) of this section, the state

• Page 5, Line 3department must publish on its website a copy of the contract,

• Page 5, Line 4scope of the work, and information regarding supervision of contractor deliverables.

• Page 5, Line 5(III)  The contract described in subsection (3.3)(b) of this section must require the RAC vendor to:

• Page 5, Line 6(A)  Conduct informal conferences or phone calls with

• Page 5, Line 7providers or provider associations to discuss the RAC program, processes, and findings;

• Page 5, Line 8(B)  Conduct provider outreach and education activities,

• Page 5, Line 9including notifying providers of audit policies, protocols, and common billing errors;

• Page 5, Line 10(C)  Respond to provider questions and requests for

• Page 5, Line 11information within two business days after receiving the question or request for information;

• Page 5, Line 12(D)  Return, within thirty days, the contingency fee

• Page 5, Line 13associated with inaccurate audit scenarios that resulted in provider refunds as prescribed by the state department; and

• Page 5, Line 14(E)  Provide preliminary RAC audit findings to a provider

• Page 5, Line 15within a reasonable period following receipt of any requested

• Page 5, Line 16medical records, as determined by the state department in

• Page 5, Line 17collaboration with the provider advisory group, created in subsection (3.5)(c)(I) of this section.

• Page 5, Line 18(d)  The RAC contract described in subsection (3.3)(b) of

• Page 5, Line 19this section may include an option to pay the RAC vendor to

• Page 5, Line 20identify underpayments for consideration in future state department budget requests.

• Page 6, Line 1(e) (I)  The state department shall implement a process to

• Page 6, Line 2verify that the RAC vendor's staff who make clinical RAC audit

• Page 6, Line 3findings are appropriately licensed pursuant to industry

• Page 6, Line 4standards and federal requirements, including that the RAC

• Page 6, Line 5vendor hire qualified coders and that the RAC vendor's staff

• Page 6, Line 6who make billing RAC audit findings have knowledge of medicaid

• Page 6, Line 7billing and coding rules and guidance adopted by the state department.

• Page 6, Line 8(II)  The state department must ensure that qualified

• Page 6, Line 9coders have relevant credentials for the type of medical services being reviewed, in accordance with industry standards.

• Page 6, Line 10(III)  Any complex audit that requires a review of medical

• Page 6, Line 11records must be conducted by licensed clinical staff with

• Page 6, Line 12training and competency in the specific type of complex audit

• Page 6, Line 13being conducted, in accordance with industry standards.

• Page 6, Line 14Providers must make all relevant medical records and

• Page 6, Line 15information related to claims reviewed during the complex

• Page 6, Line 16audit available to the RAC vendor within the time limits specified in the initial medical records request.

• Page 6, Line 17(IV)  The state department shall fully inform the RAC

• Page 6, Line 18vendor of any changes to the state billing standards and ensure

• Page 6, Line 19that the vendor only applies billing standards that were in

• Page 6, Line 20effect at the specified date of service. The state department is

• Page 6, Line 21responsible for monitoring compliance with this requirement

• Page 6, Line 22and taking appropriate action to ensure the RAC vendor's

• Page 6, Line 23compliance.

• Page 7, Line 1(V)  The state department shall ensure that the RAC

• Page 7, Line 2vendor complies with the contract requirements described in

• Page 7, Line 3subsection (3.3)(b) of this section and conducts RAC audits in a fair and consistent manner.

• Page 7, Line 4(VI)  The state department shall ensure that the RAC

• Page 7, Line 5vendor incorporates into each audit scenario, whether an automated audit or a complex audit, the following information:

• Page 7, Line 6(A)  Federal statutes and billing rules and standards

• Page 7, Line 7that are applicable to the specific provider during the specified dates of service for each audit;

• Page 7, Line 8(B)  State statutes, billing rules and standards, and

• Page 7, Line 9policies as documented in the state department's provider billing

• Page 7, Line 10manuals and provider bulletins, as well as in program guidance

• Page 7, Line 11and directives effective for the specific provider during the specified dates of service for each audit; and

• Page 7, Line 12(C)  Input from the state department's RAC staff and

• Page 7, Line 13medical director, as well as any other necessary state

• Page 7, Line 14department staff based on the staff's or medical director's review of the audit scenario.

• Page 7, Line 15(VII)  When auditing claims to make RAC audit findings,

• Page 7, Line 16the state department must ensure that the RAC vendor follows

• Page 7, Line 17all relevant and appropriate federal billing guidelines,

• Page 7, Line 18requirements set by the medicaid billing manual, standard

• Page 7, Line 19clinical guidelines, and any other applicable state or federal rules and regulations.

• Page 7, Line 20(f)  The state department shall comprehensively review

• Page 7, Line 21all audit types proposed by the RAC vendor and must approve,

• Page 8, Line 1adjust, or reject each audit type before the RAC vendor

• Page 8, Line 2conducts the RAC audit. Within eighteen months of the rollout

• Page 8, Line 3of a new audit, if the state department, in collaboration with

• Page 8, Line 4providers and the provider advisory group created in subsection

• Page 8, Line 5(3.5) of this section, determines that the audit is inaccurate, the

• Page 8, Line 6state department must refund providers who submitted

• Page 8, Line 7repayments based on inaccurate audit findings and require the

• Page 8, Line 8RAC vendor to return the contingency fee associated with the payments within thirty days.

• Page 8, Line 9(g)  The state department shall regularly review active

• Page 8, Line 10RAC audits to ensure compliance with federal and state

• Page 8, Line 11regulation changes and policy updates and discontinue a RAC

• Page 8, Line 12audit if and when appropriate due to a change in federal or state regulation or policy updates.

• Page 8, Line 13(h)  Consistent with 42 CFR 455.508 (f), RAC audits and

• Page 8, Line 14reviews conducted pursuant to this section must not review

• Page 8, Line 15claims more than three years after the expiration of the timely

• Page 8, Line 16filing period. The state department may conduct a RAC audit for

• Page 8, Line 17a claim filed more than three years after the expiration of the

• Page 8, Line 18timely filing period if required by a federal audit that would

• Page 8, Line 19otherwise result in costs to the general fund or, if directed by

• Page 8, Line 20the federal centers for medicare and medicaid services, the

• Page 8, Line 21United States department of health and human services, or any

• Page 8, Line 22other federal agency. If a RAC audit is initiated in response to

• Page 8, Line 23a federal directive, the state department must provide notice to

• Page 8, Line 24an impacted provider and include the reason for the RAC audit

• Page 8, Line 25and any relevant information about the federal requirement in the notice.

• Page 9, Line 1(i) (I)  The RAC vendor shall not require a provider to

• Page 9, Line 2undergo more than three complex audits per calendar year.

• Page 9, Line 3Hospitals must be grouped for complex audits based on their

• Page 9, Line 4total medicaid reimbursement in the previous fiscal year, and

• Page 9, Line 5groupings must be determined using state data and published annually by the state department.

• Page 9, Line 6(II)  The maximum number of medical record requests a

• Page 9, Line 7provider may receive each month must be clearly communicated

• Page 9, Line 8to providers and reviewed annually by the state department.

• Page 9, Line 9The RAC vendor shall not request more than the following number of medical records per hospital per month:

• Page 9, Line 10(A)  Six hundred for hospitals with over two hundred fifty million dollars in medicaid revenue;

• Page 9, Line 11(B)  Four hundred for hospitals with between seventy

• Page 9, Line 12million dollars and two hundred forty-nine million nine

• Page 9, Line 13hundred ninety-nine thousand nine hundred ninety-nine dollars in medicaid revenue;

• Page 9, Line 14(C)  Two hundred for hospitals with between forty million

• Page 9, Line 15dollars and sixty-nine million nine hundred ninety-nine thousand nine hundred ninety-nine dollars in medicaid revenue;

• Page 9, Line 16(D)  One hundred for hospitals with between twenty

• Page 9, Line 17million dollars and thirty-nine million nine hundred ninety-nine thousand nine hundred ninety-nine dollars in medicaid revenue;

• Page 9, Line 18(E)  Fifty for hospitals with between ten million dollars

• Page 9, Line 19and nineteen million nine hundred ninety-nine thousand nine

• Page 9, Line 20hundred ninety-nine dollars in medicaid revenue;

• Page 10, Line 1(F)  Twenty-five for hospitals with between one million

• Page 10, Line 2dollars and nine million nine hundred ninety-nine thousand nine hundred ninety-nine dollars in medicaid revenue;

• Page 10, Line 3(G)  Twenty for hospitals with under one million dollars in medicaid revenue; and

• Page 10, Line 4(H)  Ten for out-of-state facilities.

• Page 10, Line 5(III)  The requirements of this subsection (3.3)(i) do not apply if:

• Page 10, Line 6(A)  Federal medicaid directives required pursuant to 42 CFR 455, subpart F, require a higher level of claim audits;

• Page 10, Line 7(B)  An agency of the federal government requires, in

• Page 10, Line 8writing, the state department to initiate additional audit activity; or

• Page 10, Line 9(C)  A federal audit identifies additional provider findings

• Page 10, Line 10that impact the state general fund and that should be

• Page 10, Line 11appropriately recovered from that provider through an additional RAC audit and its recoupments.

• Page 10, Line 12(j) (I)  The RAC vendor shall not require a provider to

• Page 10, Line 13undergo more than four automated audits per calendar year.

• Page 10, Line 14Providers must be grouped for automated audits based on their

• Page 10, Line 15total medicaid reimbursement in the previous fiscal year, and

• Page 10, Line 16groupings must be determined using state data and published annually.

• Page 10, Line 17(II)  The maximum number of provider claims across all of

• Page 10, Line 18a provider's locations for a given calendar year that undergo automated audits must not exceed:

• Page 10, Line 19(A)  2.92 percent for providers with over ten million dollars in medicaid revenue;

• Page 11, Line 1(B)  2.50 percent for providers with between four million dollars and ten million dollars in medicaid revenue;

• Page 11, Line 2(C)  2.08 percent for providers with between one million

• Page 11, Line 3dollars and three million nine hundred ninety-nine thousand nine hundred ninety-nine dollars in medicaid revenue; and

• Page 11, Line 4(D)  1.67 percent for providers with less than one million dollars in medicaid revenue.

• Page 11, Line 5(III)  After the administrative process is exhausted, if the

• Page 11, Line 6state department identifies a denial rate of forty percent or

• Page 11, Line 7higher for a specific provider on a specific audit type, the state

• Page 11, Line 8department shall audit no more than an additional twenty-five

• Page 11, Line 9percent of the claim percentages stated in subsection (3.3)(j)(II) of this section associated with that audit type.

• Page 11, Line 10(IV)  The requirements of this subsection (3.3)(j) do not apply if:

• Page 11, Line 11(A)  Federal medicaid directives required pursuant to 42 CFR 455, subpart F, require a higher level of claim audits;

• Page 11, Line 12(B)  An agency of the federal government requires, in

• Page 11, Line 13writing, the state department to initiate additional audit activity; or

• Page 11, Line 14(C)  A federal audit identifies additional provider findings

• Page 11, Line 15that impact the state general fund and that should be

• Page 11, Line 16appropriately recovered from that provider through an additional RAC audit and its recoupments.

• Page 11, Line 17(k)  When conducting audits, the RAC vendor must:

• Page 11, Line 18(I)  Request provider records that are relevant to the

• Page 12, Line 1claims being audited and that do not duplicate information already provided;

• Page 12, Line 2(II)  Not audit the validity of a provider's prior authorization received from the state department; and

• Page 12, Line 3(III)  For a complex audit, not audit claims that are on the

• Page 12, Line 4federal centers for medicare and medicaid services

• Page 12, Line 5inpatient-only list at the date of service for a level-of-care determination.

• Page 12, Line 7(l) (I)  If the RAC vendor identifies preliminary findings

• Page 12, Line 8during the RAC audit, the RAC vendor must send the provider a

• Page 12, Line 9notice of preliminary audit findings detailing the preliminary

• Page 12, Line 10findings, the rationale for the preliminary findings, and the

• Page 12, Line 11methodology for how the dollar amounts associated with the preliminary findings were calculated and determined.

• Page 12, Line 12(II)  For a complex audit, a provider may request an exit

• Page 12, Line 13conference to discuss the preliminary findings with the RAC

• Page 12, Line 14vendor and the state department medical director, or the state

• Page 12, Line 15department medical director's designee, prior to participating in

• Page 12, Line 16an informal reconsideration. The provider may provide

• Page 12, Line 17additional information supporting the provider's claims at the

• Page 12, Line 18exit conference. A provider must request an exit conference no

• Page 12, Line 19later than thirty days after the provider receives a notice of

• Page 12, Line 20preliminary audit findings from the RAC vendor, and if an exit

• Page 12, Line 21conference is requested, the state department or the RAC

• Page 12, Line 22vendor must schedule the exit conference within sixty days of

• Page 12, Line 23receiving the request and on a mutually agreed upon date and time.

• Page 13, Line 1(III)  Within thirty days of the exit conference, the state

• Page 13, Line 2department must notify the provider on whether the state

• Page 13, Line 3department will dismiss the preliminary findings or will issue a

• Page 13, Line 4notice of informal reconsideration. The notice of informal

• Page 13, Line 5reconsideration must include details on the preliminary

• Page 13, Line 6findings, the rationale for the preliminary findings, and the

• Page 13, Line 7methodology for how the dollar amount associated with the

• Page 13, Line 8preliminary findings were calculated and determined. If an exit

• Page 13, Line 9conference occurred, the notice must include information on

• Page 13, Line 10why the state department did not agree with the provider's approach.

• Page 13, Line 11(IV)  Unless the preliminary findings are accepted by the

• Page 13, Line 12provider, dismissed by the state department following an exit

• Page 13, Line 13conference, or the period for a provider to request an exit

• Page 13, Line 14conference has expired, a provider who receives a notice of

• Page 13, Line 15preliminary findings, the state department, and the RAC vendor

• Page 13, Line 16must participate in an informal reconsideration before the

• Page 13, Line 17provider may formally appeal the state department's

• Page 13, Line 18determination. To participate in an informal consideration, the following requirements must be satisfied:

• Page 13, Line 19(A)  Within sixty days of receiving the notice of informal

• Page 13, Line 20reconsideration, the provider must submit all medical records

• Page 13, Line 21relevant to the claims and the reasoning for the provider's

• Page 13, Line 22disagreement concerning the preliminary audit findings. The

• Page 13, Line 23medical records must substantiate the provider's argument to

• Page 13, Line 24dispute any preliminary findings to allow the state department

• Page 14, Line 1and the RAC vendor to reconsider the findings, and the

• Page 14, Line 2department and the RAC vendor must review medical records prior to the informal reconsideration meeting;

• Page 14, Line 3(B)  The state department must schedule an informal

• Page 14, Line 4reconsideration meeting between mutually agreed upon

• Page 14, Line 5participants from the state department, RAC vendor, and

• Page 14, Line 6provider representatives at a mutually agreed upon date and

• Page 14, Line 7time within ninety days of issuing the notice of informal

• Page 14, Line 8reconsideration, although either party may request a sixty-day extension; and

• Page 14, Line 9(C)  All agreed upon attendees must participate in the

• Page 14, Line 10informal reconsideration meeting in good faith in an effort to resolve the dispute.

• Page 14, Line 11(V)  If a claim remains in dispute after the informal

• Page 14, Line 12reconsideration meeting, the state department must issue a

• Page 14, Line 13notice of adverse action within sixty days of the informal

• Page 14, Line 14reconsideration meeting. The notice of adverse action must

• Page 14, Line 15include the basis of the alleged overpayment, the rationale for

• Page 14, Line 16the alleged overpayment, the methodology used to calculate

• Page 14, Line 17the alleged overpayment, and information on why the state department did not agree with the provider's approach.

• Page 14, Line 18(VI)  Within thirty days of receiving a notice of adverse

• Page 14, Line 19action, the provider may request a formal appeal, which must

• Page 14, Line 20include an explanation of the basis of the appeal in accordance with rules adopted by the state department.

• Page 14, Line 21(VII)  The state department must not recover an

• Page 14, Line 22overpayment identified in the preliminary findings from a

• Page 15, Line 1provider until the informal reconsideration process, and subsequent formal appeal, if filed, are complete.

• Page 15, Line 2(VIII)  If the state department has not issued a notice of

• Page 15, Line 3adverse action one hundred twenty days following the informal

• Page 15, Line 4reconsideration meeting, the state department waives its right to recover the state share of the overpayment.

• Page 15, Line 5(m)  Providers are subject to all state and federal

• Page 15, Line 6medicaid fraud, waste, and abuse laws and must comply with all

• Page 15, Line 7applicable program integrity requirements. Failure to comply

• Page 15, Line 8may result in removal from the state medical assistance

• Page 15, Line 9program, financial penalties, civil lawsuits, or criminal

• Page 15, Line 10prosecution pursuant to 42 U.S.C. sec. 1320a-7k(d), 42 U.S.C. sec.

• Page 15, Line 111320a-7, 31 U.S.C. secs. 3729-3733, sections 24-31-808, 25.5-4-301,

• Page 15, Line 1225.5-4-303.5 to 25.5-4-310, and 10 CCR 2505-10, sec. 8.076. By

• Page 15, Line 13participating in the medical assistance program, providers

• Page 15, Line 14acknowledge and accept their obligation to adhere to all state

• Page 15, Line 15and federal laws governing medicaid fraud, waste, and abuse, and program integrity.

• Page 15, Line 16(n) (I)  The state department shall publish and maintain on

• Page 15, Line 17its website a RAC audit activity report for each RAC audit and

• Page 15, Line 18review completed in the preceding year summarizing the findings

• Page 15, Line 19of those RAC audits and reviews. The information posted on the

• Page 15, Line 20state department's website concerning each RAC audit must include the following information:

• Page 15, Line 21(A)  A summary of the audit scenario, the state

• Page 15, Line 22department's billing practices, and policy guidelines being

• Page 15, Line 23reviewed by the RAC vendor;

• Page 16, Line 1(B)  The error rates identified during the RAC vendor's review;

• Page 16, Line 2(C)  The number and amounts of overpayments and underpayments identified by the RAC vendor;

• Page 16, Line 3(D)  The recoveries collected by the state department on identified overpayments;

• Page 16, Line 4(E)  The number of claims appealed as a result of the audit; and

• Page 16, Line 5(F)  Details on the audit scenarios and billing standards

• Page 16, Line 6used by the RAC vendor and policy guidance on proper billing practices.

• Page 16, Line 7(II)  In addition to the information required by subsection

• Page 16, Line 8(3.3)(n)(I)of this section, the state department shall publish and

• Page 16, Line 9maintain on its website information on the number of informal

• Page 16, Line 10reconsideration meetings the state department participated in

• Page 16, Line 11and the associated percentage of findings that were upheld, the number of appeals, and corresponding determinations.

• Page 16, Line 12(o)  On or before January 1, 2026, the state department

• Page 16, Line 13shall publish on its website provider education information;

• Page 16, Line 14resources to assist providers in understanding the state

• Page 16, Line 15department's medicaid billing manual and rules; and procedures

• Page 16, Line 16related to RAC audits, including documentation requirements and the process for resolving disputes.

• Page 16, Line 17(p)  At least quarterly, the state department shall:

• Page 16, Line 18(I)  Conduct medicaid billing training for providers and

• Page 16, Line 19hold meetings with providers to gather feedback on the RAC

• Page 16, Line 20audit process. The state department shall publish meeting dates

• Page 17, Line 1and times on the state department's website at least two weeks prior to the meetings.

• Page 17, Line 2(II)  Conduct trainings for providers and hold

• Page 17, Line 3stakeholder meetings regarding audits and reviews, during

• Page 17, Line 4which the state department and RAC vendor must identify

• Page 17, Line 5common billing errors identified by the RAC vendor in the previous quarter and provide clarification on the billing errors.

• Page 17, Line 6(q)  The state department shall work with small or rural

• Page 17, Line 7providers in order to identify and implement opportunities to

• Page 17, Line 8reduce administrative burdens and better support compliance

• Page 17, Line 9with medicaid billing practices, as adopted in the state

• Page 17, Line 10department's medicaid billing manual, and experience with RAC audits.

• Page 17, Line 11(r)  The state department must submit an annual report to

• Page 17, Line 12the joint budget committee that includes a description of the following:

• Page 17, Line 13(I)  The divisions of the state department that are

• Page 17, Line 14included in the review and approval of RAC audit scenarios and the roles and responsibilities of each division;

• Page 17, Line 15(II)  The RAC vendor's compliance with the response

• Page 17, Line 16requirement described in subsection (3.3)(c)(III)(C) of this section;

• Page 17, Line 17(III)  The state department's oversight and enforcement of

• Page 17, Line 18the contractual requirement that the RAC vendor conduct

• Page 17, Line 19informal conferences or phone calls with providers or provider

• Page 17, Line 20associations to discuss the RAC program, appeal processes, and

• Page 17, Line 21findings;

• Page 18, Line 1(IV)  The training materials prepared by the RAC vendor

• Page 18, Line 2after each RAC audit that identify and address the common

• Page 18, Line 3errors and issues identified during the audit and the content

• Page 18, Line 4and materials the RAC vendor used to educate providers to prevent errors in the future;

• Page 18, Line 5(V)  A summary of the RAC vendor's outreach and education activities;

• Page 18, Line 6(VI)  A summary of the state department's written policies,

• Page 18, Line 7procedures, and guidance that establish processes for the state

• Page 18, Line 8department to log provider communications, provide direction

• Page 18, Line 9on how state department staff must respond to communications

• Page 18, Line 10in a timely and relevant manner, and how the state department

• Page 18, Line 11instituted routine analysis of provider communications to inform decisions on program improvements; and

• Page 18, Line 12(VII)  The total amount of alleged overpayments

• Page 18, Line 13identified by the RAC vendor, the proportion of those

• Page 18, Line 14overpayments that were recovered, and the total amount paid to the RAC vendor.

• Page 18, Line 15(s)  All recoveries collected by the state department on

• Page 18, Line 16identified overpayments pursuant to this subsection (3.3) must be

• Page 18, Line 17transmitted to the state treasurer, who shall credit the same

• Page 18, Line 18to the recovery audit contractor recoveries cash fund, which

• Page 18, Line 19fund is created in the state treasury and referred to in this

• Page 18, Line 20subsection(3.3)(s)as the "cash fund". The cash fund consists of

• Page 18, Line 21money credited to the cash fund pursuant to this subsection (3.3)

• Page 18, Line 22and any other money that the general assembly may appropriate

• Page 18, Line 23or transfer to the cash fund. Subject to annual appropriation by

• Page 19, Line 1the general assembly, the state department may expend money

• Page 19, Line 2from the cash fund to offset the need for appropriations for

• Page 19, Line 3medical services and to pay the RAC vendor. The state

• Page 19, Line 4treasurer shall credit all interest and income derived from the

• Page 19, Line 5deposit and investment of money in the recovery audit contractor recoveries cash fund to the cash fund.

• Page 19, Line 6(t)  The state department may adopt rules, as necessary, to implement the requirements of this subsection (3.3).

• Page 19, Line 7(3.5) (c) (I)  The state department shall create a provider advisory

• Page 19, Line 8group for recovery audits consisting of employees of the state department

• Page 19, Line 9and members from different provider groups types, including physicians,

• Page 19, Line 10hospitals, and any other provider types directly impacted by audits

• Page 19, Line 11conducted pursuant to this section, appointed by the executive director.

• Page 19, Line 12The provider advisory group shall meet at least quarterly to review

• Page 19, Line 13quarterly activity reports required by subsection (3)(a)(IX) subsection

• Page 19, Line 14(3.3)(n) of this section and advise the state department on issues providers experience with audits of the recovery audit contractors program.

• Page 19, Line 15(II)  The state department and the RAC vendor shall

• Page 19, Line 16provide the provider advisory group with the opportunity to

• Page 19, Line 17review RAC audit scenarios during the provider advisory group's quarterly meetings.

• Page 19, Line 18(III)  The state department shall give providers the

• Page 19, Line 19opportunity to anonymously describe RAC audit scenarios they

• Page 19, Line 20are experiencing and ask questions about billing practices. The

• Page 19, Line 21state department shall include RAC vendor staff and the

• Page 19, Line 22relevant state department division staff in these discussions. If

• Page 19, Line 23the discussions lead the state department to determine that an

• Page 20, Line 1audit scenario was inaccurate, the state department must work with the RAC vendor to rescind the RAC audit.

• Page 20, Line 2SECTION 2.  Appropriation adjustments to 2025 long bill.

• Page 20, Line 3(1)  To implement this act, appropriations made in the annual general

• Page 20, Line 4appropriation act for the 2025-26 state fiscal year to the department of

• Page 20, Line 5health care policy and financing for medical and long-term care services for medical-eligible individuals are adjusted as follows:

• Page 20, Line 6(a)  The cash funds appropriation from recoveries and recoupments is decreased by $20,900,588;

• Page 20, Line 7(b)  The cash funds appropriation from the recovery audit

• Page 20, Line 8contractor recoveries cash fund created in section 25.5-4-301 (3.3)(s), C.R.S., is increased by $20,900,588.

• Page 20, Line 9SECTION 3.  Act subject to petition - effective date. This act

• Page 20, Line 10takes effect at 12:01 a.m. on the day following the expiration of the

• Page 20, Line 11ninety-day period after final adjournment of the general assembly; except

• Page 20, Line 12that, if a referendum petition is filed pursuant to section 1 (3) of article V

• Page 20, Line 13of the state constitution against this act or an item, section, or part of this

• Page 20, Line 14act within such period, then the act, item, section, or part will not take

• Page 20, Line 15effect unless approved by the people at the general election to be held in

• Page 20, Line 16November 2026 and, in such case, will take effect on the date of the official declaration of the vote thereon by the governor.