Don’t Fumble Your Audit

Dodge these five pitfalls to stay sure-footed during a medical claims audit.

An official letter arrives in the mail saying you’re being audited. If this hasn’t happened to you yet, it will. And when it does, don’t panic. Take a few minutes to huddle with your co-workers and think about what you can do to make sure your office passes muster. Begin by building a good defense; and from an auditor’s perspective, avoid the following top ways to fumble an audit.

No. 1: Not Responding

The worst mistake you could make is not responding to the audit request. Lack of response will be interpreted as lack of interest (you just don’t care)—or, even worse, that you know you can’t pass the audit. If you don’t respond to the request, you can expect another audit letter within six months. And if you don’t respond to that, you might as well cut the insurance company a check for the claims payment.
Avoidance Tip: Read the letter carefully. The insurance company may tell you which specific claims they’re auditing or they may just be letting your office know they intend to audit in the near future. If you’re not clear on what’s happening, call the insurance company’s contact person and ask. There should always be a contact name and number or email on the letter. Insurance companies prefer you ask questions than not respond at all.

No. 2: Incomplete Records

Another big way to invite trouble is to send incomplete records. Chances are you don’t need to send the entire patient chart. Send only the requested information. If the insurance company wants to see records for the date of service 03/17/13, double-check with your billing system to see what claims were submitted. You may need to get records for services that were billed by your provider, but not necessarily done in the office. For example, the claims in question may be for outpatient services your physician performed in an emergency room, or inpatient surgical services he or she performed at a hospital.
Avoidance Tip: Again, if you need more details on what the auditor is looking for, call and ask. Make sure you’re calling the actual auditor, not your unofficial insurance contact (he or she may not be involved). Check your billing system and verify whether you have records for all billed services (paid or not). Request the records you don’t have copies of, such as those held at a hospital or other facility. Last but not least: Be sure the patient’s name and other identifying information (such as date of birth or date of service) is on each page submitted. Printing from online transcription or getting your documentation from an electronic health record (EHR) doesn’t override this requirement. You might need to handwrite the name and other indentifying information on every page.

No. 3: Illegible Records

The golden rule is “not documented, not done.” The same thing goes for legibility: If an insurance company can’t read your records, they can’t audit them. And if they can’t audit them, they can’t give you credit for the services performed.
Avoidance Tip: Perform a legibility test in the office if you’re not using transcription or an EHR. Be sure the average biller can read what the provider documented. If not, consider having the note transcribed or typed. The same thing goes for signatures. A legible provider signature is a “must have.” Payers need to know that the billing provider matches the performing provider. If multiple providers in your group handwrite their signatures or initials, consider creating a signature log that shows the full, formal printed name of each provider, his or her full legal signature, and how the signature is abbreviated (such as initials or first initial and last name).

No. 4: Being Unprepared

An audit should not be a surprise to you. Audits are a part of life now, especially with the government (both federal and state) focusing on fraud, abuse, and waste. If you don’t already have a plan for how your office keeps copies of documentation and verifies that documentation exists for billed services, right now is a great time to come up with one.
Avoidance Tip: Periodic, internal auditing is the best way to be prepared. If your budget permits, an outside audit consultant is a great way to make sure your results are impartial. If this isn’t possible, pull random chart samples based on your billing records. Make sure you have access to appropriate documentation and that billing matches it. You can wait a few days for EHR documentation, transcription, or outside entities to complete their parts, if necessary. Check enough charts to ensure a level of certainty. Document your efforts as part of your compliance plan. This might take a chunk of your time, but efforts now will save you pain later.

No. 5: Not Reviewing the Outcome

Generally, an auditor will prepare a formal response letter or report explaining what he or she found as a result of the audit. Not reviewing the letter or failing to take into consideration the advice within could cause you trouble, especially if the results aren’t what you hoped for (in some cases, an audit result can trigger further audits).
Avoidance Tip: Read the report. Don’t just file it away. Look for anything that might be helpful to you. For example, the auditor may make recommendations for your practice, such as reviewing ICD-9-CM guidelines or documenting the provider’s signature. If you don’t understand something, call the auditor and ask for an explanation. If you’re provided with an opportunity to answer the audit, use it to bring supporting information to the table that could explain or defend your claims. Bring audit results to your practice staff meetings, as well.
Audits happen for many reasons. It’s safe to assume that if your practice hasn’t been audited yet, it will be, eventually. These tips won’t prevent an audit, but they’ll help you reach the finish line without feeling like you were just tackled by a bunch of linebackers.
Sarah Hobson, CPC, CPC-H, CPC-P, CPMA, CANPC, works for a Medicaid Health Maintenance Organization based in Rhode Island and has worked in billing and coding since 1995. She holds a Master of Business Administration from the University of Massachusetts – Lowell, and is pursuing a Master of Science in Health Informatics from Northeastern University. Hobson is a member of the Brandon, Fla., local chapter.

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Renee Dustman, BS, AAPC MACRA Proficient, is managing editor - content & editorial at AAPC. She holds a Bachelor of Science degree in Media Communications - Journalism. Renee has more than 30 years' experience in journalistic reporting, print production, graphic design, and content management. Follow her on Twitter @dustman_aapc.

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