March 19, 2015

New RA Contract Terms Violate Federal Regulations

On March 10, the U.S. Court of Appeals for the Federal Circuit issued an order addressing the payment terms for the new Recovery Auditor (RA) contract. The court found contract solicitation in violation of the Federal Acquisition Regulation because it delayed contingency fee payments to contractors until after the second level of appeal. In addition, this delay was inconsistent with customary commercial practice.

It appears that this court action will delay any new RA contracts, including the implementation of a number of recently announced modifications to the contracts. The court remanded the case to the Court of Federal Claims for proceedings consistent with its decision, and CMS may be required to rebid the new RA contracts without the provision to delay the payment of the contingency fee.

Contact Kathy Reep , vice president of finance at (407) 841-6230 for additional information.