Regular Session
Government Affairs & Regulatory Compliance Analysis
HB142 mandates the aggressive expansion of Recovery Audit Contractors (RACs)—third-party auditors incentivized by contingency fees—to identify and recover Medicaid overpayments effective May 29, 2025. This legislation exposes Medicaid providers and Managed Care Organizations (MCOs) to heightened scrutiny but establishes critical statutory defenses regarding claim age and concurrent reviews that you must operationalize immediately to prevent revenue loss.
Rep. Candy Noble·House Bill·Regular Session
Health and Human Services Commission (HHSC) • Office of Inspector General (OIG) • Third-party Recovery Audit Contractors (RACs)
This legislation has regulatory implications for the following Texas businesses and organizations:
Notable regulatory updates (effective 2025-05-29). Consider how these changes may affect your operations.
Affected business types:
mediumModerate costs expected for implementation.
JD Key Consulting provides government affairs and regulatory strategy services. We help businesses navigate Texas agencies, understand legislative impacts, and advocate for their interests.
JD Key Consulting provides strategic guidance on Texas regulatory compliance and legislative impact for your business.
Key implementation requirements and action items for compliance with this legislation
JD Key Consulting specializes in Texas regulatory compliance strategy. Work directly with James Dickey—former Chairman of the Republican Party of Texas—to understand this bill's impact on your operations and develop an actionable compliance plan.
Schedule a ConsultationInformation presented is for general knowledge only and is provided without warranty, express or implied. Consult qualified government affairs professionals and legal counsel before making compliance decisions.
This bill's path through the Texas Legislature
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Common questions about HB142
HB142 mandates the aggressive expansion of Recovery Audit Contractors (RACs)—third-party auditors incentivized by contingency fees—to identify and recover Medicaid overpayments effective May 29, 2025. This legislation exposes Medicaid providers and Managed Care Organizations (MCOs) to heightened scrutiny but establishes critical statutory defenses regarding claim age and concurrent reviews that you must operationalize immediately to prevent revenue loss.
HB142 was authored by Texas Representative Candy Noble during the Regular Session.
HB142 was signed into law by Governor Greg Abbott on May 29, 2025.
HB142 is enforced by Health and Human Services Commission (HHSC), Office of Inspector General (OIG) and Third-party Recovery Audit Contractors (RACs).
The regulatory priority for HB142 is rated as "moderate". Businesses and organizations should review the legislation to understand potential impacts.
The cost impact of HB142 is estimated as "medium". This may vary based on industry and implementation requirements.
HB142 addresses topics including human services, human services--medical assistance, health & human services commission, inspector general for health & human services and electronic information systems.
Key dates for HB142: Effective date is 2025-05-29. Rulemaking: Adopt rules establishing an appeals process for overpayments identified by Recovery Audit Contractors (RACs). (Unspecified (Prerequisite for RAC program enforcement)); Adopt rules necessary to implement the Recovery Audit Contractor program in consultation with the OIG. (Discretionary). Consult with legal counsel regarding applicabilit
HB142 primarily affects healthcare providers and medical facilities. These businesses should review the legislation with their legal and compliance teams to understand potential impacts.
JD Key Consulting is an Austin, Texas-based government affairs firm led by James Dickey, former Chairman of the Republican Party of Texas. We specialize in Texas regulatory compliance and legislative strategy for data centers, energy, banking, and manufacturing.
