As the spotlight stays focused on value-based care – CMS continues to ramp up their audit protocols for Medicare suppliers and facilities. Medical providers need to stay current on updates and understand best audit management practices. Join us as we look at the latest news surrounding CMS audits and review the best tips and practices you can take to be prepared.

Man conducting audit management with tablet

“No compliance program? Get to work! In an audit, a compliance program indicates the practice is making an effort to code, document and bill correctly.”

Join us on October 25th as we discuss Audit Management best practices.For providers today, audits have become both more frequent and more complex. Given the changes to the audit landscape, it is imperative for healthcare organizations to allocate resources to establishing audit management processes and identifying associated revenue risks. Audits present a variety of challenges for organizations, with auditors capitalizing on providers’ internal workflow issues, process flaws, and technology weaknesses. If providers fail to establish sophisticated audit management processes, they are likely to encounter operational and financial performance issues, which greatly affect their bottom line.

Providers and suppliers of Medicare services will be subject to Targeted Prove and Educate (TP&E) audits beginning this fall of 2017 (click here to see the official announcement from CMS). In a recent article, JD SUPRA reports on the upcoming change and explains that these audits will include provider education and they expand on CMS’s current pilot auditing program that has only been applied to three Medicare Administrative Contractor (MAC) jurisdictions. The article explains that:

“TP&E will focus the MACs on targeting high-risk areas while encouraging Medicare providers and suppliers to understand and correct their billing behavior to prevent future incorrect claims. TP&E begins with MACs identifying providers and suppliers with either high claims error rates or with billing practices that differ materially from other similar providers and suppliers. The MACs will use data analysis to identify these two groups and it was implied that the MACs could rely on the Common Working File; historical billing, payment and utilization data; and other internal or external sources to conduct their data analysis.”

JD SUPRA reports in another article that as a result of the pilot phase decreases in a number of claims errors and claim appeals were observed after education was provided to the providers/suppliers.

Problems with CMS Audits on the Horizon?

As reported by RAC Monitor, the United Healthcare (UHC) network bulletin posted an article earlier this summer that spoke of their decision to discontinue paying for consult services. The same article featured the following excerpt that leaves the authors at RAC Monitor wondering if potential problems with audits could be on the horizon:

“New Policy – Advanced Practice Health Care Professional Evaluation and Management Procedures Policy: Effective for claims with dates of service on or after Sept. 1, 2017, UnitedHealthcare will require physicians reporting evaluation and management (E/M) services on behalf of their employed Advanced Practice Health Care Professionals to report the services with a modifier to denote the services were provided in collaboration with a physician. UnitedHealthcare will accept the modifier SA on claims for these services when provided by nurse practitioners, physician assistants, and clinical nurse specialists. In addition, the rendering care provider’s National Provider Identifier (NPI) must also be documented in field 24J on the CMS-1500 claim form or its electronic equivalent. Use of the modifier SA and documentation of the rendering care provider will assist UnitedHealthcare in maintaining accurate data with regard to the types of practitioners providing services to our members.”

RAC Monitor reports this seems to not be an issue for claims denials – rather a concern for claims audits/review. Again, smart audit management can save the day.  The use of the SA modifier could cause potential issues for providers depending on whether they are credentialed through UHC and are using the modifier correctly.

The American Hospital Association (AHA) weighed in on the issue of serious problems with hospital compliance reviews in an open letter to the Director, Office of Financial Management Centers for Medicare & Medicaid Services.  The letter, from the AHA’s general counsel, states, “…we understand the need for robust and effective review of billing and payment practices by all Medicare providers, including hospitals. However, the OIG’s hospital audits regularly include fundamental flaws and inaccuracies, both in the OIG’s understanding and application of Medicare payment rules and in the procedures the OIG uses to conduct the audits.”

CMS to Conduct Better Oversight During Transition from State IT Marketplace to Federal?

The US Government Accountability Office suggests that CMS should improve oversight of State IT systems for performance and sustainability. Their report recommendation states that:

“The Department of Health and Human Services’ (HHS) Centers for Medicare & Medicaid Services (CMS) has offered assistance through providing periodic oversight and issuing regulation and guidance to states transitioning from state-based marketplaces to the federally based marketplace IT platform, including two states that GAO reviewed—Hawaii and Oregon—that had made that transition. While CMS provided these states with assistance, documented CMS transition guidance was not finalized until after the two states had completed their transition. The two states incurred costs of approximately $84.3 million, collectively, to transition to the federal platform. The two states’ transition efforts included making changes to their Medicaid systems, with these states mainly relying on Medicaid matching funds from CMS to do this. While the selected states successfully transitioned, they encountered challenges during their transitions, due to accelerated transition time frames, difficulties reassigning marketplace responsibilities, delays in receiving approvals from CMS, and trouble accessing historical consumer data in previous vendor-developed marketplace IT systems.”

Audit Management to Help you Prepare and Mitigate Risk

Healio published an article that offers tips for providers to mitigate audit risks by taking the following six steps on an annual basis:

  1. Familiarize your entire staff on basic evaluation and management (EM) criteria for documentation. Medical necessity must support all three of the following components: examination, history, and clinical decision-making.
  2. Compare your EM data to national and state peer data. Just as CMS will compare your data against others – you can do the same in order to identify any internal trends that deviate from the norm.
  3. Run a report on the frequency and use of each CPT. These reports can be generated from practice management systems (PMS) and show how many times each provider billed each CPT code.
  4. Audit 10 notes against the codes billed for each provider. Use a variety of encounters that include different services, such as procedures and injections – and compare the physicians’ notes again the EM codes billed to be sure they match.
  5. Peer review findings in a meeting. In order to draw conclusions and implement facility-wide change, the findings need to be addressed in a peer discussion which creates awareness and accountability.
  6. Document all actions and findings in your compliance plan. Keep details about the process used, results of your own in-house audits and actions taken as a result.

Sarah Wiskerchen, the author of the article ended the piece by saying:

“No compliance program? Get to work! In an audit, a compliance program indicates the practice is making an effort to code, document and bill correctly.”