Section 455.506 - Activities to be conducted by Medicaid RACs and States(a) Medicaid RACs will review claims submitted by providers of items and services or other individuals furnishing items and services for which payment has been made under section 1902(a) of the Act or under any waiver of the State Plan to identify underpayments and overpayments and recoup overpayments for the States. (1) States may exclude Medicaid managed care claims from review by Medicaid RACs.(b) States may coordinate with Medicaid RACs regarding the recoupment of overpayments.(c) States must coordinate the recovery audit efforts of their RACs with other auditing entities.(d) States must make referrals of suspected fraud and/or abuse, as defined in 42 CFR 455.2 , to the MFCU or other appropriate law enforcement agency.(e) States must set limits on the number and frequency of medical records to be reviewed by the RACs, subject to requests for exception from RACs to States.