RAC Audit Process

We at Chapman Law Group represent providers nationwide during Medicare Recovery Audit Contractors (RAC) audits. Our team of audit attorneys has extensive experience in Medicare audits, including RAC, ZPIC and Safeguard (PSC) audits. Together, our team of health care audit attorneys help providers respond to audits and defend their claims.

Recovery Audit Contractors review past Medicare claims for potential overpayments or underpayments. The RAC focuses their review on areas identified by the Comprehensive Error Rate Testing (CERT) as having a high propensity for error. The RAC uses proprietary software to identify claims that are likely to contain improper payments. 

The RAC typically does not review claims that have already been reviewed by another Medicare contractor. The RAC does not create the payment policy.  The payment policy used by the RAC is determined by Medicare regulations, Medicare billing instructions, NCDs and LCDs.

Recovery Audit Contractors

First, the RAC identifies a risk pool of claims.  Second, the RAC requests medical records from the provider. Once the records are received by the RAC, they will review the claim and medical records. Based on the review, the RAC will make a determination: overpayment, underpayment or correct payment.

If it is determined that an overpayment exists, the RAC sends the file to the MAC to adjust the claim and recoup the payment. The MAC will notify the provider with an overpayment notification letter.

At that time, the medical provider can appeal the determination to the MAC. The normal appeal process applies. If an overpayment is owed back to the Medicare program, the provider has several options. The medical provider can pay by a check, allow recoupment from future payments, request an extended payment plan or appeal the determination.

After a physician or medical provider receives notice of a determination by a RAC, the provider can exercise three options: discussion, rebuttal and redetermination. These options are not mutually exclusive. 

First, the provider has an opportunity to “discuss” the determination with the RAC. The provider can provide additional information to the RAC and the RAC can further explain the rationale for the recoupment. The provider should contact the RAC and supply additional information within 40 days of the receipt of the Demand Letter. The provider should contact the RAC directly. 

Another option the provider may utilize is rebuttal. The provider can give a statement and evidence indicating why overpayment or recoupment action would cause a significant financial hardship for the provider. The rebuttal process is not used to disagree with the overpayment decision or to submit supporting medical documentation. Providers that wish to exercise the rebuttal option must contact the MAC directly. The rebuttal must be filed within 15 days of the date of the Demand Letter.

Finally, the provider can request a redetermination.  A redetermination is the first level of appeals. The redetermination request should be filed within 30 days from receipt of the demand letter (can file up to 120, but to avoid an offset should be filed in 30 days). The redetermination is filed to the MAC.

It is important for physicians or medical providers to respond in a timely manner to a demand letter based on a RAC determination that a Medicare overpayment exists. It is possible for the provider to limit their options by exceeding the time filing requirements. 

It is important to carefully review the claims that have been determined to be overpaid.  If an actual overpayment exists, a medical provider should try to determine how and why the overpayment occurred.  Chapman Law Group can assist physicians and medical providers to analyze their claims and to determine the cause for the RAC audit or Medicare overpayment.

Do not attempt to defend yourself or your practice without an experienced Medicare fraud attorney.  The potential for a highly prejudicial outcome is very high.  With a competent attorney focusing their practice in health care law, you have a much better probability of guiding the outcome and avoiding criminal charges or more severe monetary penalties or being placed on the integrity watch list by OIG for Medicare fraud.

Why You Should Choose Chapman Law Group When Your Health Care Practice is Audited

At Chapman Law Group, we represent providers and practices nationally during Medicare audits, Medicaid audits and third-party payor audits. Our team of Medicare and Medicaid audit attorneys has extensive experience in Medicare audits, including ZPIC, RAC, and Safeguard (PSC) audits.

Our offices are in Detroit (where we serve Dearborn, Troy, Ann Arbor and Grand Rapids, and the rest of Michigan); Miami and Sarasota, Florida (for Jacksonville, Tampa, Orlando, West Palm Beach, and all of Florida); Los Angeles/Southern California; and Chicago

Do not hesitate to call the attorneys at Chapman Law Group if you are engaged in an audit. With lawyers dedicated to helping providers defend their claims during audits, recovery action and appeals, you are in strong hands. Contact us today for a consultation.

Need an Attorney? Contact us now!


  • This field is for validation purposes and should be left unchanged.


  • This field is for validation purposes and should be left unchanged.

Got A Question?

Contact me now to schedule a consultation.

Other Practice Areas​


Related Case Results

Healthcare Audit Defense Attorneys

Here’s what health care providers and practices need to know about Medicare audits, Medicaid audits and third-party payor audits — and how our healthcare defense lawyers can help you.

Read More »

Related Blog Posts

FREE Health Care Newsletter

Stay up to date on the latest news in health care law!

FREE eBook!

Click the link below to download our compliance eBook now!
Chapman Law Group Favicon

This website uses cookies to ensure you get the best experience on our website.

Send this to a friend