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How to Audit Effectively

Do you know if your practice’s billing and coding is being done promptly and properly? It’s crucial to find problems soon after they occur (or even before they occur) and have an opportunity to correct them quickly. A comprehensive and consistent periodic auditing program can help do this. It may also make your practice more efficient and more profitable.

Adopt Formal Program

Many practices don’t have a formal auditing program. They may decide to audit only if a problem arises, or if the practice is adding a partner, merger or is for sale. But it’s prudent to have a formal program that calls for regular audits. A system of regular audits will help you if you ever must fight a payor over an improperly denied claim or defend a request for repayment. If you audit regularly and can show comprehensive audit records, you’ll have a much easier time documenting your side to payors.

OIG recommends conducting a baseline audit. baseline audit should review claims submitted during the previous three months by looking for problems throughout the claim’s preparation and submission process. Look at every step from patient intake to assuring proper documentation to timely submission of claims. Audit should be random sampling of charts. It should include charts from all physicians and providers in your practice. You also want to include charts that every coder worked on. And your sample should include a few charts for every payor your practice routinely deals with.

Schedule Periodic Audits

After the baseline audit, you should conduct an audit regularly—in its compliance program guidance, the OIG says at least annually. But quarterly or monthly is better, depending on the size and resources of your practice and whether your baseline audit turned up any systemic problems. If your baseline audit turned up serious problems, monthly audits are a good idea. You can see whether the solution you devised is working and fine-tune any corrective action with the information you get from the monthly audits.

Choose prospective or retrospective audits

You must decide whether you’ll audit prospectively (before you submit claims) or retrospectively (after they’re paid or denied). A prospective audit means you’re most likely to catch the problem before anyone else does, but it can cause delays in accounts receivable. If you choose to do a retrospective review, it’s imperative that any problems you find be immediately corrected.

Both Centers for Medicare & Medicaid Services (CMS) and the Office of Inspector General (OIG) recommend that health care providers routinely enlist independent parties to audit coding practices. Many health care organizations welcome these audits to obtain feedback regarding their coding programs, in large measure to improve quality.

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