Recovery Audit Contract OCMP-26-25113 (RAC)

The Maryland Department of Health is soliciting proposals for a Recovery Audit Contract to identify Medicaid improper payments in hospital claims, with proposals due November 20, 2026 and a pre-proposal conference on October 14. This procurement is limited to certified small businesses, and MBE and VSBE subcontracting goals of 14 percent and 2 percent respectively apply.

The scope requires auditing all claims for three hospital provider types — 107 general in-state hospitals, 642 out-of-state hospitals, and 10 in-state psychiatric hospitals — at least once every two years. The contractor must perform data mining and complex algorithmic analysis on Maryland Medicaid Fee-For-Service claims to identify overpayments and underpayments, establish a secure web-based provider portal, maintain comprehensive claim databases, comply with HIPAA requirements, and provide support throughout the appeals process, including testimony at administrative hearings if needed. Offerors must have at least three years of hospital claims and payments auditing experience within the prior five years, attest to no current or prior contractual relationships with hospitals subject to audit, and confirm they are not on federal exclusion lists.

Compensation is structured as a contingency fee of 10 percent of dollars recovered as overpayments or paid as underpayments, though offerors may propose alternative recovery percentages. The Maryland Department of Health has identified approximately $30 million in annual overpayments on roughly 3 percent of all claims paid; primary overpayment sources are bundling errors, lack of supporting documentation, and duplicate charges. The contract term begins August 1, 2027, with three base years (July 1, 2027 through June 30, 2030) followed by two one-year option periods. The contract is federally funded under Medicaid Title XIX and XXI. Questions are due November 4, 2026 at 2 p.m.