Understanding Insurance Audits
- What’s at stake during an insurance audit?
- What steps should your practice take if you’re audited?
We answer all of your most pressing questions.
If your practice submits claims to health insurance payers, you likely know that health insurance audits are not uncommon. Receiving an audit notification from a payer can be overwhelming and the daunting audit process itself can add to that overwhelmed feeling. Let’s discuss crucial information about health insurance audits and what steps your practice should take when undergoing one.
What is the insurance company looking for?
Audits, whether from the?Centers for Medicare and Medicaid Services?or from a private insurance company, aim to root out fraud, abuse, and waste in the healthcare system. However, audits also help to encourage practitioners to foster proper medical billing practices and maintain compliance with laws.
Responding to an Insurance Audit
How you respond to an audit can set the tone for and shape the progression of the entire process. Audit notifications should be taken seriously. Here are some steps to take when presented with an audit notification:
- Don’t panic!?Audits are a reality in the healthcare industry and an insurance audit does not necessarily indicate that your practice has engaged in anything improper.
- Very carefully review every word of the audit notification.?When was it sent and when is the deadline? How many patient charts and other documents are requested? Is there a stated reason for the audit?
- Try to determine the scope of the audit.?This will depend on what entity is auditing you and how much information they provide, but this step can help determine the size and impact of the audit.
- Once you understand what is being requested, prepare all requested information noted in the audit letter.?This can include medical records, invoices, and other materials. Usually, a copy of the complete medical record will have to be included. This is because many commercial payers will require a physician to sign a document indicating that the records provided constitute the entire medical record for that patient.
- Comply with the deadline.?Send a copy of everything that was requested, unless an original was explicitly requested. If you cannot locate a specific document or file, request more time from the auditor.
- Upon audit conclusion, your practice should thoroughly review and correct the issues found during the audit.?The results of the audit should be an educational tool used to educate you and your staff on proper practices. Additionally, this will help minimize your risk in the future.
- Ignoring an audit or missing a deadline can be enough to constitute failing the audit. Failing to provide information will mean that the claim will not get paid and if the claim was already paid, you will have to reimburse the payer for the payment.
What prompts an insurance audit?
The origin of audits is often the biggest question. Many times, there is no specific discernable cause for the audit. While it makes sense that payers do not usually divulge the “why” of how an audit began (because audits are usually meant to be a surprise), there are certain circumstances that can lead to an audit
- Computer monitored practice patterns
- Complaints from patients or employees
What activities can trigger an audit?
- Inadequate Documentation
- Unbundling
- Up coding level of CMT or E/M services.
- Under coding level of CMT or E/M services.
- Illegible documentation (health care record cannot support services billed).
- Lack of medical necessity for services billed.
- Treatment billed not substantiated by treatment plan
- Services inconsistent with corporate medical policies.
- Waiving or reducing co-pays.
- Billing for non-covered services.
The majority of these steps are time-consuming. Consult with us for dealing with insurance audits, we will provide you the best solutions at our experience as a medical billing company. Do not be afraid to ask the guidelines and workplace security and privacy policies and procedures.
