H.R. 9422 — Medicaid RAC Improvement Act of 2026

This section requires the Secretary of Health and Human Services to establish policies and procedures within 180 days for communicating Medicaid Recovery Audit Contractor (RAC) program exception expirations to states, monitoring those dates, and requiring annual state reports on RAC program methodologies, audit limits, and overpayment recoveries. It mandates annual reports to Congress beginning December 31, 2027, on RAC program effectiveness with state-specific data, and limits exceptions under section 1902(a)(42)(B)(i) through December 31, 2028.

This section requires states to include reviews of claims paid by Medicaid managed care organizations, prepaid inpatient health plans, and prepaid ambulatory health plans in their Medicaid recovery audit contractor programs. It directs states, not later than January 1, 2028, to ensure contracts with such entities provide for payment integrity reviews to identify and recoup overpayments, either by the plans themselves for up to 18 months or by state contractors, along with cooperation and coordination requirements.

This section requires states to submit annual reports identifying reviewing entities for each Medicaid payment stream and directs the Secretary to report the results to Congress with recommendations. It requires the Secretary to study barriers to state participation in Medicaid recovery audit contractor programs and conduct a 5-year demonstration project to increase participation, with interim and final reports to Congress. It mandates that recovery audit contracts cover audits and recoveries for the current fiscal year and the prior 4 fiscal years, beginning 120 days after enactment.