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Medical Billing Audit

Does your practice have medical billing audit plan, and who is conducting those audits? Some practices believe that internal auditing makes the most sense. After all, audits can be costly, and practices must do everything they can to remain competitive – especially when healthcare systems are consolidating into ever-larger and more powerful organizations.


What’s In an Audit? An audit can take two forms. Prospective audits are performed before claims submission and retrospective audits are performed after claims have been paid. Both forms of audit should be conducted regularly and can be conducted by an internal staff or utilizing outside auditing firm.


In a medical billing audit, billing documentation and coding are two of the most important areas tested. If a bill is undercoded, revenue is lost. If this happens on a consistent basis, even a small mistake can become quite substantial to the practice financially. Overcoded bills generate more revenue than they should, and if discovered, that money must be returned to the payer. If overcoding is discovered by the OIG, the money will be demanded by Medicare, the practice may be fined, and be put on OIG pre-payment review. Transposed CPT numbers or even inaccurate patient data can also result in denied claims. The audit process can identify all these errors.


Internal Audits

While it may seem as though an internal audit would be less costly, a medical billing audit requires objective, dedicated resources. With a dedicated internal audit group, audits may be performed on a periodic or even ongoing basis, allowing the organization to continuously adapt its processes for improved accuracy. However, even a dedicated audit staff must be checked, so every practice should have an independent, external audit performed on monthly, quarterly or annual basis.


Advantages of External Audits

Medical practice regardless of size, can be a busy place, and often there just aren’t enough hours in the day to attend to the task of a medical billing audit. An external audit review can provide an impartial view as well as providing education, consultation, comprehensive reports and recommendations for improvement.


Whether you choose to perform internal audits or utilizing services of external audit firm for your medical billing audits is something to consider in order to ensure your practice gets objective information about its billing accuracy. An objective audit is a crucial element for any practice and organization as part of compliance program that can help maximize your medical billing and exposure to the OIG audit.

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