New audit threats to watch The first major new audit is coming from the Medicaid RACs. These were launched at the beginning of 2012, but are not expected to reach full swing until 2013. While some states are still selecting their contractors, others are already seeing increasing volumes in Medicaid RAC audits. Many states were waiting to hear the final decision on the Affordable Care Act (ACA) before proceeding with their recovery audit programs. Now that the Supreme Court has held ACA to be constitutional, more states are picking up their Medicaid RAC activity. Medicaid RACs are looking at many of the same targets as the Medicare RACs. Current activity indicates a large number of automated reviews for coding and billing errors versus complex reviews involving complete medical record requests. Providers can also expect more prepayment reviews coming from CMS for Medicare. These are the RAC prepayment reviews designed to supplement – not replace – the MAC payment reviews.