Medicare RAC, benefits coordinator merge for $400M

New York-based HMS Holdings has reached terms to acquire Las Vegas-based HealthDataInsights (HDI) for about $400 million, the former announced yesterday. HDI, the Medicare Recovery Audit Contractor (RAC) firm for Region D and the exclusive auditor for 17 states and three territories, reviewed more than $300 billion in claims last year. "The HMS/HDI combination will create the nation's premier provider of improper payment identification services for Federal, State, and commercial health benefit programs," HMS CEO Bill Lucia said in a statement. The deal consists of $384 million in cash, with the remainder in unvested options.

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