Coming to a Practice Near You
by Cheryl Nash
This year has been an exciting one for audits. The government has ramped up both RAC and ZPIC audits, as well as audits from Medicare Advantage Plans. If you participate with any of these plans, chances are you already have, or certainly will, have a request for charts sent to you. There are typically 3 different types of audits you can be subjected to.
The most common are audits carried out by various Medicare Advantage Plans. CMS (Medicare) scrutinizes these plans to determine if payments were distributed for appropriately documented and billed services. The largest advantage plan administrators are Humana, Aetna, and United Healthcare, although there are a number of others. Most of the providers I know have had a sample of charts requested by both of these payers in the past two years. While usually no adverse effects come from these, the information does go directly to CMS and can raise a flag if something untoward is found.
The next type is a RAC audit. This is an audit designed to identify and collect improper Medicare payments. This is contracted out to a Recovery Audit Contractor (RAC) who’s oversight region matches the regions for each Medicare Administrative Contractor (MAC). RAC contractors receive an initial fixed payment for each instance of improper payment found. Additionally they receive a percentage of any funds recovered, so they are very motivated to find something wrong with your charts! If improper payments are found, there are both refund requests and penalty fees with interest to contend with. This can get costly very quickly. Additionally, the RAC can review a sample of claims, and if overpayments are detected, they can then extrapolate the total amount of overpayment applying the sample percentage to all claims within a timeframe. RACs tend to focus on Hospitals and large physician groups.
Another type of audit is the ZPIC, Zone Program Integrity Contractors. These contractors are investigators for fraud and abuse. ZPICS are not random audits. They are generated by billing errors identified by computer data analysis, or they can also be the result of a filed complaint. When selected for a ZPIC audit, your claims will be reviewed to determine if a fraud investigation is warranted. ZPICs focus on smaller practices, home healthcare, and smaller clinics. They can be either a pre or post payment review, and payment can be suspended until the investigation is completed. ZPICs can refer cases for law enforcement action if fraud is determined, and they can also refer cases back to the MAC for overpayment collection. Neither option is desirable. However, they are also able to decide if the only action needed is provider education as a resolution to incorrect billing practices. This is of course the outcome everyone wants. An internal review of you billing and charting practices, and a corrective plan of action would be advisable.
Now that I have you attention, let me be the first to state that if you are an honest practice, and are not intentionally defrauding the system, then an audit is imminently survivable. Though initial determination may be unfavorable, an appeal process is available and should be utilized. This is where you get to state your side of the case. Make use of all options available to you, but in the spirit of education, also take this as an opportunity to correct any issues that you may not have been aware of. The feedback can be invaluable for the future of your practice.
If you have not been on the receiving end of audit (yet), I suggest taking a pro-active approach. Take a few of your charts and view them with a critical eye. Ask yourself “would a reviewer understand the documentation? How about the rationale for treatment? “. “Are my notes legible to anyone outside my practice?”. “Do I meet the payer’s guidelines for Medical Necessity? When was the last time I reviewed those?”. Another option would to be to have an outside source perform an unbiased review for you. There are several companies that can perform this service, and should be taken into consideration. I have performed a number of these over the years, and just like reading your own writings, most people tend to miss mistakes other may see as obvious. Another word of caution: Do not presume that because your documentation if generated by an EHR that it is automatically proof against an Audit. The latest buzz in incorrect charting is canned documentation, and electronic records can potentially have more errors and inconsistencies than previous dictated documentation. The auditors are on the lookout for this.
Regardless of the course of action you choose to take, preparedness is the best way to survive an audit. If you expend effort to avoid issues before they happen, you will be better armed against any adverse future problems. A regularly scheduled internal review of the policies and procedures your practice follows will greatly enhance your continued success.
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