The only way to verify coding accuracy is to compare the coding against the medical record documentation. The medical charts review, the most frequently conducted healthcare audit, looks at documentation and claims information to determine if claims have been appropriately coded. Show
Chart auditing programs have become necessary in response to the increase in federal payer audits. Even commercial payers have geared up teams to conduct frequent and random on-site and off-site compliance audits of hospitals and medical practices. When a provider organization performs an internal audit — or hires an independent auditor to perform an external audit — the organization learns if its claims will withstand government scrutiny. It also gains an opportunity to self-report and correct issues that pose a threat to their financial viability. Every medical coder should learn how to conduct a medical coding audit in view of its potential value to their employer (and their coding career). Fortunately, the audit process is easy to understand when broken down into its component parts. Step 1: Plan the Medical Record AuditPerhaps you need a medical record audit to establish a baseline for the organization. Perhaps you need to assess the effectiveness of previous staff education. Auditing objectives range from investigating areas of insufficient documentation to identifying improper coding, billing activity, and post-payment risks. Regardless, in all cases, conducting the audit to produce useable data requires planning. The first questions to consider include:
Chart auditing is an iterative process, meaning that you repeat the process, and what you learn from one audit affects your starting point for the next. Therefore, answers to these questions will likely change. But understanding what is to be learned through the audit will enable the auditor to make the best decisions, and, once decisions are made, to maintain a focus on the objectives throughout the course of the medical audit. Step 2: Choose Between 2 Basic Auditing Methods
Each medical practice must determine which type of audit method will work for its environment. It’s also important to note that errors identified in the retrospective audit must be resolved through corrected claims, refunds to the payer, and possible self-disclosure. Step 3: Decide the Audit ApproachChoosing between a focused audit and a random audit will depend on which approach serves the audit’s objectives.
Most baseline audits, designed to inform the medical practice how it fares in relation to correct coding and billing, are random audits and should include all coding practices, services, and physicians and practitioners in the organization. Step 4: Determine Audit ScopeDetermining the scope of the audit involves honing or defining factors that entered the decision to go with a focused or random audit. You might choose a random sampling if this is the practice’s first audit. If, though, the organization has conducted previous audits, past audit reports should suggest a focus area, such as new office visits, consultations, inpatient visits, or certain diagnosis codes. Reasons might necessitate a payer-focused audit and require you to review charts billed exclusively to Medicare, Medicaid, or another payer. Similarly, you might perform a provider-focused audit or a coder-focused audit. Maybe you need to review high-volume services or services with high denial rates. Priority should be the key determinant when defining the audit scope. Coding and billing complexities with a heightened potential to affect reimbursement or liability can’t be overlooked without consequences. Less urgent target areas can be assured necessary assessment with an audit work plan that schedules recurring audits for the year. In defining the audit scope, the auditor should include the date range of the audit sample. Step 5: Determine Sample SizeThe audit sample should use a percentage of patient encounters that represent the encounter types. Auditing too few records may distort results, while auditing too many records becomes impractical in terms of time and labor. The standard sample size ranges from 10 to 15 charts. When conducting an audit involving multiple physicians, the OIG recommends five to 10 charts per medical provider. The OIG also recommends using RAT-STATS to help with statistical sampling. This tool is provided for free through the OIG and will tell an auditor how many charts to pull for an accurate sample size. Tools such as RAT-STATS allow the practice to understand the sampling methodologies used by payers. This, in turn, allows the practice to remain proactive in compliance efforts by mining information reflecting high-risk areas. If the practice can identify these areas, audit the documentation and coding, and provide education based on variances, it will lower the probability of having a payer audit reveal hidden liabilities. Step 6: Select Audit ToolsAn efficient audit tool is important when auditing the medical record. If the auditor is conducting a review of surgical notes, for example, a surgical audit tool should be used. If the auditor is conducting an evaluation and management (E/M) audit, the tool needs to reflect the guidelines used by the practitioner. Some auditors choose audit software to audit records, print an audit report, and help analyze the data. Keep in mind that computer software does not have the capability to evaluate medical necessity. This is a “thinking” process that requires the auditor to possess a strong background in medical coding. When selecting an audit tool, remember that tools can vary among payers. MAC tools may vary, as well. The auditor should choose according to the audit scope, using a payer- or MAC-specific tool when applicable. It’s also imperative to have references on hand. For accuracy and to support audit findings with verifiable guidelines, the auditor should refer to:
Step 7: Locate DocumentationOnce the sample size and charts have been identified, you’ll need to collect documentation pertaining to the date of service (DOS) for charts under review. In addition to a note, the medical record for the patient encounter might include labs, forms, images, and other miscellaneous items. All documentation is required to successfully conduct the review. In a retrospective audit, you’ll need the superbill/charge ticket, patient chart, claim form or billing record (to validate what was submitted), and the explanation of benefits (EOB) or Remittance Advice — for each patient encounter. You might also want to familiarize yourself with the chart organization, special forms including the history form, problem list, and medication sheet. Step 8: Conduct the AuditUsing your tools and resources, perform the audit. Be sure to review both coding and documentation. Pay attention to the guidelines in the CPT®, ICD-10-CM, and HCPCS Level II coding books, as well as ensuring proper documentation. Double check coding criteria for services such as:
Step 9: Analyze Audit FindingsOnce the audit is complete, analyze your findings and identify problem areas, such as:
Step 10: Create the Audit Analysis and Summary ReportCompile the audit findings in a concise audit report. Your writing style should be detailed yet persuasive. The reader should be able to understand what was audited and how the audit was performed. Identify the number of encounters documented correctly and incorrectly. Note trends and errors in coding. Each error or risk area should be outlined categorically and labeled so as to define the category (for example, particular CPT® code, particular payer, particular provider, or specialty). All errors should be explained and include a citation to the appropriate standard. Finally, suggest remedial actions. Recommendations might include additional training or modification of documentation systems. Usually included is a recommendation for follow-up analysis to evaluate the effectiveness of the corrective action. The auditor’s approach to communicating the audit results is as important as the approach to the audit. Choose a constructive tone to avoid defensive reactions that could sabotage improvement efforts. And give the staff time to review the results and prepare questions before meeting. The audit report should be the first post-audit communication, in other words. Know your audience and personalize audit findings for the medical coder, the physician, and the nonphysician practitioner. Step 11: Meet with Coders, Practitioners, and Ancillary StaffDiscussing audit findings allows the auditor to address risks and the corrective actions to mitigate them. Allow enough time to talk about each case, offer suggestions, and answer questions. When conferencing with the provider, you may get pushback. A physician may be less concerned with coding and compliance and more concerned with patient care. If reimbursement drives the provider’s thinking, have figures ready that show a revenue loss or gain. If the provider is more concerned with unwanted attention from CMS, outline the potential risk for an audit target. Let staff know what they did well and how they can improve. If a physician isn’t documenting a thorough assessment and plan, for example, explain why capturing these elements is important for the patient and the practice. If audit findings are under dispute, substantiate them with hard copies of payer and coding guidelines. Remember, the tone of communication is crucial. Your goal is to establish open dialogue. Step 12: Make Recommendations for ImprovementThe audit won’t benefit the organization if efforts aren’t made to address utilization pattern abnormalities, coding errors, and documentation deficiencies. Use audit findings to educate providers on how to improve clinical documentation. Your recommendations might include shadowing sessions or creating “cheat sheets” to help practitioners capture the full clinical story and all services provided during the patient encounter. Audits can also direct ancillary staff training. Tailor education to correct detected problems. Educate medical coders and billers on the proper coding and billing of CPT® codes, ICD-10-CM codes, HCPCS Level II codes, and modifiers. If internal policy causes error, revise the policy. Commit to following through on all recommendations, particularly audit-tailored training, monitoring, and suggested target areas of future audits. Step 13: Provide Ongoing Monitoring and AssessmentConsult with providers and the compliance officer or practice manager to establish (or modify) an audit work plan. A general rule of thumb to determine how often to conduct a chart review is more errors, more audits. Create a timeline based on the audit results. For instance, if reviewed charts achieve 90% accuracy, a standard annual audit should keep the organization compliant. Up the audit cycle to every quarter if accuracy drops between 75 and 90%. Audit monthly for accuracy below 75%. Finally, perform a prospective audit with accuracy below 60%. The workload might seem daunting, but the alternative is worse. Step 14: Execute Audit Follow-upIf an error has been identified and found to have resulted in overpayment, it’s necessary to report the error to the payer. The organization may voluntarily return the overpayment or request that the payer initiate a demand letter. How refunds are handled will depend on the payer who made the overpayment. If, however, you suspect the overpayment is linked to a pattern of claim errors that has accumulated a sum in overpayments, you have an obligation to investigate. You will need to initiate the process of a focused audit. If your findings confirm a significant error rate involving overpayments without evidence of fraudulent conduct, the organization should seek legal counsel to determine whether to voluntarily identify, disclose, and refund overpayments. Auditors don't handle self-disclosures. When one is needed, legal counsel should take over the disclosure process and participate in the creation of a corrective action plan. AAPC has an audit services division, AAPC Client Services, that provides full-service healthcare compliance and corporate integrity audits for outpatient practices, health plans, healthcare attorneys, and government regulators to ensure supported medical necessity, correct coding, and compliance with regulatory issues. Get more information on how AAPC Client Services can fulfill your auditing needs. Which type of audit are mainly used in hospital?Internal audits are used to evaluate the quality system based on standards as well. They are conducted to prepare for external audits. Healthcare organisations also use internal audits to continuously improve the quality of healthcare.
What is the most common audit type?A financial audit is one of the most common types of audit. Most types of financial audits are external. During a financial audit, the auditor analyzes the fairness and accuracy of a business's financial statements. Auditors review transactions, procedures, and balances to conduct a financial audit.
What are the 3 main types of audits?There are three main types of audits: external audits, internal audits, and Internal Revenue Service (IRS) audits. External audits are commonly performed by Certified Public Accounting (CPA) firms and result in an auditor's opinion which is included in the audit report.
What are the types of medical audit?There are 2 main different types of clinical audit: national clinical audits and local clinical audits.
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