Relating to certain payment recovery and recoupment efforts under Medicaid and the child health plan program.

SB 1616 requires Medicaid managed care organizations to provide healthcare providers with 60 days' written notice before collecting overpayments and to wait until all appeal rights are exhausted. It prohibits these organizations from reviewing medical necessity decisions or errors in claim documentation not caused by the provider during audits of previously approved services. The bill also establishes a program for contracting recovery audit contractors to identify and recover Medicaid overpayments. These changes take effect September 1, 2025, directly affecting Medicaid managed care organizations and healthcare providers in Texas.