As a health care provider, you’re probably aware of the efforts by the state and federal governments to identify and recover overpayments made by the Medicare and Medicaid programs. The Medicare Modernization Act of 2003 and subsequent legislation CMS dramatically expanded CMS’ authority to detect and recover overpayments made by the Medicare and Medicaid programs. CMS has engaged a number of contractors to audit health care providers to identify and recoup overpayments. Chances are high that your facility has been or will be subject to an audit by one of the many CMS or NC Division of Medical Assistance (DMA) contractors, and the best way to come out ahead is to be prepared now.
The audit contractors use sophisticated data mining techniques to identify providers for audit, and many use statistical processes to extrapolate an overpayment amount that is exponentially higher than the overpayment identified in the sample of claims the audit contractor actually reviews. Historically, billing issues like high claim rejection rates, higher utilization than neighboring providers and unusually long lengths of stay have been red flags for auditors looking for targets. Avoiding these types of issues can help decrease the chance that your facility will trigger an auditor’s interest, but complaints from beneficiaries and utilization screens might also trigger an audit.
No matter what type of audit and auditor you face – ZPIC, RAC, MIC or other – some common principles apply to preparing and responding.
What can you do to prepare now?
- Develop, implement and maintain an updated compliance program.
- Develop and implement policies and procedures for handling correspondence from auditors and responding to requests for records.
- Assign a point person for receipt of audit request letters, and make sure that person knows what to do with those letters and when (immediately!).
- Make sure that your Medicare administrative contractor (MAC) and DMA have the correct mailing address for your facility to improve the chances that an audit letter requesting records will end up in the right place for a timely response rather than languishing in a PO Box for days or weeks.
- Implement a mode for tracking and documenting each audit process, and assign roles and responsibilities for each stage of the process.
- Educate key personnel within your facility – billing personnel, clinicians and administration. Be sure your billers know what pieces of documentation must be in place prior to billing for a service, and have a fail-safe in place to make sure that the documentation exists before billing. Be sure your clinicians understand the appropriate components of documentation, including the need for legible signatures.
- Monitor material posted by CMS, DMA and their contractors to gain insight into the types of issues that trigger audits and the focus of the audits.
- Perform an internal audit of your organization and address any identified weaknesses.
What do you do when you receive notice that you are being audited?
- Pay careful attention to the timelines for response set forth in the initial letter, and respond in a timely manner.
- Pay careful attention to the records requested. Be sure to provide all records that are pertinent to the dates of service set out in the letter. Some of these records may predate the actual dates of service listed in the letter. For example, the certification covering the dates of service requested with regard to one resident may be dated earlier than the dates of service for which medical records were requested. Be sure to provide the certification and any other documents that demonstrate why it was appropriate for the payor to pay the amounts that it did for those dates of service.
- Provide records in an organized, comprehensive manner and ensure copies are legible. This will make it easier for the auditor to conduct the audit and to conclude that payment was proper.
- Involve experts. These may be your clinical or billing staff or external consultants who can help you identify the appropriate records and prepare a response.
- Maintain a copy of everything – correspondence, emails and records that you provide or receive – and log it.
- Try to get information from auditors in writing. If you can’t, write it down yourself. Make notes of telephone calls you have with an auditor, inclusive of the date, time, persons involved and subject matter.
- Cooperate. The more organized and responsive you are, the better the chances that the process will move along smoothly.
Depending on the type of audit, the provider will have an opportunity to appeal unfavorable results. But the best defense really is a good offense when it comes to appealing audit results, so it makes sense to expend time, energy and resources now to best position your facility to avoid overpayments and to defend itself in the event of an overpayment determination.