What is a demand letter?

• A. A notice of audit
• B. A request for payment
• C. A consent letter
• D. Document describing the rationale for a RAC determination and providing information in case an appeal is warranted

Answer: (D)

A demand letter in the RAC process is the formal notice that follows a determination of overpayment. It explains why the RAC believes payment is due by detailing the rationale or basis for the decision and provides information on how to appeal if the provider disagrees, including the steps and timelines involved. This makes it more specific than a simple request for payment, because it explicitly links the amount due to the underlying reasoning and the available appeal rights. The other options describe different things (an audit notice, a consent letter, or a plain payment request) and do not include the combination of rationale and appeal information that defines a demand letter.