Practice Management Alert

Conducting internal audits will help your practice avoid costly payer discoveries.

Since it is just a matter of time before an outside entity sends an auditor to your practice door, now’s the time to shore up your coding, billing, and compliance. By reviewing and analyzing your coding in a self-audit, you can shore up your processes.

Your audit plan is the most important part of your compliance program, because without it, your compliance plan is nothing more than a policy and procedural binder stuck on a shelf somewhere, said Frank D. Cohen, director of analytics and business intelligence with Doctors Management, LLC, during the webinar “Building a Risk-Based Audit Plan.”

1. Compile your data for review. If you determined that your code utilization is dramatically different from Medicare averages, then you might pull five charts to start your audit, based on the codes you’ve identified as being performed more frequently than average. If you find issues with those five, look at five more, Cohen informed. “If six out of the 10 are improper, you may want to pull a statistically valid random sample of at least 30.”

2. Calculate your findings. If you haven’t evaluated your code utilization and instead you’re performing a random probe audit, you should pull more charts — typically about 200 per physician, he instructed. Check whether the physicians are coding and documenting correctly, and then calculate the results and determine your audit schedule.

3. Base audit timeline on results. Some practices say if the charts they reviewed were coded correctly 90 percent or more of the time, they audit annually, then they move to quarterly audits if the success rate is between 75 and 90 percent, Cohen said. If the accuracy rate is between 60 and 75 percent, they audit monthly, and if it’s below 60 percent, they’d audit every claim before submitting. You can use a variation on this schedule at your own practice, he said, or you can simply create the schedule that suits you best.

4. Utilize trends to devise a long-term plan. “When you’re done, set up a trend analysis so you can see from period to period and determine how your education and training worked,” he advised. “Did the providers do better or worse? Did they respond positively? Are they immune to training? Because you spend lot of time and money on this and you want to know how it’s working.”