The OIG has called on CMS to strengthen activities to prevent improper Medicare payments, including enhancements to the Recovery Audit Contractor (RAC) program. For instance, the OIG notes that RACs identified half of all claims they reviewed in FYs 2010 and 2011 as having resulted in improper payments totaling $1.3 billion. While CMS took corrective actions to address the majority of identified vulnerabilities, the agency did not evaluate the effectiveness of these actions, however, so high levels of improper payments may continue. The OIG also raised concerns about CMS failure to act on all referrals of potential fraud that it received from RACs, along with gaps in CMS evaluations of RAC performance on contract requirements. The OIG recommends that CMS: address identified vulnerabilities; ensure that RACs refer all appropriate cases of potential fraud; take appropriate action on RAC referrals of potential fraud; and enhance RAC performance evaluation. CMS generally concurred with the OIG recommendations. The report, “Medicare Recovery Audit Contractors and CMS’s Actions to Address Improper Payments, Referrals of Potential Fraud, and Performance,” is available here.