A new legislative push in Washington is targeting billions of dollars in improper government spending by tightening rules on how states track Medicaid funds. Senate Committee on Aging Chairman Rick Scott and U.S. Representative Gus Bilirakis introduced the Medicaid RAC Improvement Act of 2026, a bicameral bill designed to force all states to participate in federal anti-fraud auditing programs.
Background
The legislation specifically updates the Medicaid Recovery Audit Contractor (RAC) program. Right now, loopholes allow most states to opt out of participating in these reviews. The new bill closes those gaps, mandates nationwide participation by states, and expands auditors’ legal authority to review and detect improper or fraudulent payments.
The sudden push follows data showing that Medicaid paid out $37 billion in improper payments in 2025 alone. Congress originally brought the RAC program to Medicaid in 2010 after a similar 2003 Medicare pilot successfully recovered $1.03 billion in bad payments over three years.
Support for the Bill
Supporters of the bill state that plugging these holes is the only way to keep the program viable for the low-income families and individuals who rely on it for healthcare. “Medicaid serves as a vital lifeline for millions of Americans, and we have a responsibility to ensure every dollar dedicated to the program is used appropriately and reaches those it is intended to help,” Rep. Bilirakis said.
Original reporting: Tampa Free Press — read the source article.
