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Auditor's Corner

Charge Capture and Revenue Integrity

Charge capture is a crucial part of the revenue cycle process. Accurate charge capture processes will improve cash flow and increase revenue which will improve the bottom line and satisfy regulatory compliance. Healthcare organizations that fail to accurately document information on the care provided at their facilities can potentially lose millions in revenue.

Healthcare organizations need to focus on charge capture and charge audit. Although some healthcare organizations have a dedicated department focused on preserving revenue integrity, many healthcare organizations address the concept less formally. A strong clinical chart auditing program will ensure sound documentation, improving healthcare organizations ability to capture missed revenue, reduce denials and improve patient care.

Chart auditing is an extremely important part of charge capture and conducting a monthly Concurrent Audit Review should be part of every healthcare organization.  A concurrent audit is defined as a complete audit on a non-disputed account on both inpatient and outpatient accounts to verify that charges represent services rendered to the patient are accurate and are ordered by physician as well as identifying and correcting any discrepancies.

A proper trained Medical Chart Auditor with strong clinical and billing experience assisting the appropriate department managers and nursing departments with maintaining and/or developing Charging Protocols and Policies in all revenue producing departments can play a significant role in identifying, correcting and improving the recovery of lost revenue process within your healthcare facility/organization.

Organizations that are not consistently working to improve charge capture, denials, and underpayments, are leaving money on the table which can add up to tens of millions of dollars as well as to compliance problems and external payer audits.

Benefit of external partner


At times, it can be overwhelming to identify the proper audit channels, and a third-party resource can be quite valuable. Within a revenue integrity department, there are so many objectives to focus on and at times, it is easy to spread yourself thin. A third party can bring a fresh perspective, which is a non-biased outlook to charge capture function. Facilities that choose to outsource due to the shortage of qualified nurse auditors and qualified medical coders find that they gain more control of their revenue cycle, with an added benefit of increased revenue collection. Outsourcing is a solution that fits the needs of large hospital groups, standalone hospitals, large and small physician groups, and other healthcare organizations. It can result in reduced backlogs and reduced cost.


In conclusion, regardless of each organizational approach, revenue recovery and charge capture can make a substantial and significant impact to the facilities bottom-line. Every revenue generating department within the hospital must properly document and record charges in order to establish control mechanisms to ensure that appropriate procedures and charging protocol are being followed thereby maintaining a healthy economic environment.

Coding Audits

Coding audits, which are the validation of code assignment against the supporting clinical documentation and coding guidelines, are an instrumental way to ensure accuracy. Healthcare organizations in general, conduct an audit for two primary reasons:

1. For revenue reasons to make sure that the practice is properly billing for its services
2. For compliance reasons to make that the practice is only billing for the services it’s providing.


An audit cycle is one of the best ways to ensure the ongoing health of any healthcare organization. An audit will help confirm that your organization is in fact doing well, it will also help strengthen those areas that need to be strengthened and will help shine a light on those areas that need attention.


An ongoing internal quality audits can be used to prevent payer denials. Denial trending or analyzing the overall volume of payer-denied cases, can identify patterns of inaccurate code assignment and unsupported clinical conditions. These patterns can lead to focus areas for coding audits that may benefit from clinical documentation improvement or coding staff education.


Coding audits can reveal a wide range of problems, including incorrect levels of service, under- and over-coding, and the improper use of modifiers. The audit findings may suggest that the clinical documentation is supportive of the code assignment or the results may show supporting the conditions with further clinical evidence is required.


Regardless of the outcome, an audit sample selection tactic that promotes meaningful account mixture with emphasis on identification, correction process and/or education means not only serves to improve accurate code assignment but also reduces the number of denials and in turn requires less resources to review and appeal denials, resulting in fewer payment retractions.

How often should you audit?

The Office of Inspector General (OIG) recommends auditing claims submitted during the prior three months on five to ten randomly selected claims per provider. The more providers you have, the more time it will take for the chart auditing process. Healthcare organizations need to have an ongoing audit plan and conduct an audit more than once a year. Recommend doing audits quarterly and looking at a minimum of 10 records per provider.


Also, 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 as a way to obtain feedback regarding their coding programs, in large measure to improve quality.

What to do after an audit?

For an audit to be successful, a practice must commit the necessary resources to make the changes needed to come into and remain in compliance. A key component to that is staff training to ensure that the new processes work and that your medical records, your coding, your billing and all the other aspects of your medical business continue to run smoothly.


Coding audits should be part of normal business practice for facilities and providers. While the audit process can be time and cost intensive, the values and return on investment far outweigh the efforts. By looking at aspects of your facility or practice and determining what elements are likely to reveal errors, you can correct a targeted sample selection instead of leaving it to chance with a random sample.

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