Surviving a Dreaded Payer Audit - The Top Ten "To Do" List
By:  Cheryl Krusch, LPN, CPC

You've just opened a letter from Medicare, Medicaid, or a third-party payer requesting copies of medical records. Now what? The best advice is to be prepared, because what you do after opening that letter could make a big difference in the outcome from both a financial perspective and a compliance perspective. 

Of the two main types of audits, the most common is a prepayment audit, a review of claims before you are paid. In most cases, the auditor will want to look at only a claim or two. The second type is an analysis of claims after payment, and this can be more extensive. If you are being audited, here are 10 steps you may want to take: 

Call your healthcare attorney, malpractice carrier, compliance officer or risk manager. Understand what you need to do to comply with the request . 

Know all parties involved. Determine who is requesting the records and confirm that they are authorized to do so. For example, the letter could come from Medicare or Medicaid, but because auditing, especially in the case of recovery audit contractors (RACs), is outsourced to various companies, sometimes the actual sender isn't clearly identified or immediately obvious. 

Control the situation by assigning a dedicated individual or a specific team to communicate with the requesting entity. Any inquiries or requests should be handled only by those individuals. 

Set a tone of cooperation right from the start, with professionalism and politeness. It's never a good idea to alienate the auditors. 

Document all communications. Keep a written log, with dates and times, of all correspondence and conversations. 

Determine the time frames in which you must respond; sometimes extensions are available if you need them. Request them properly and receive written authorization from the appropriate party to amend due dates. In most cases, these requests will be granted. 

The letter you receive may tell you specifically what the auditors are looking for and what documents they require. Before the auditors arrive, review those documents to determine your exposure by doing a chart audit. However, never alter or change a chart - for example, don't add a missing signature. You may want to  engage consultants to assist in preparation, pre-review the records and help you understand how to best to manage the process.

If one doesn't exist, begin developing a compliance plan. 

Create a welcoming, or at least accommodating, environment for the auditors. Set them up in a room, make them comfortable, and be available at all times to answer questions. Be sure all documents requested are available. Records should be in order and clearly marked. Don't make their job difficult. 

When you receive the report and findings, compare it to your own internal review. Auditors sometimes are inflexible in their interpretation of law when in fact some leeway exists. If you disagree with the auditors' report, sit with them, your attorney and consultants to compare findings. Auditors may be inexperienced in certain clinical areas and may be willing to work with you. If agreement cannot be  reached, an appeal process should be available for you to contest the findings. 

Some of the organizations that may  audit medical practices or facilities and ask for records include : 
  • QIO - Quality Improvement Organization 
  • CERT - Comprehensive Error Rate Testing 
  • MAC - The Medicare Area Contractor 
  • RAC - Recovery Audit Contractor 
  • PSC - Program Safeguard Contractor 
  • ZPIC - Zone Program Integrity Contractor 
  • OIG - Office of the Inspector General 
  • FBI - Federal Bureau of Investigation 

Audits can be stressful, but they do not always spell gloom and doom. Although audits could result in significant overpayment assessments, the good news is that there are steps you can take to help minimize the  impact on your practice.

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