What is Medical Billing Audit? And what is its scope?
Medical Billing Audit is the systematic process of examining and evaluating all billing processes’ effectiveness, accuracy, and compliance. Thus audit of the entire medical billing process will ultimately help a practice have a superior revenue cycle management system in place, which will aid in maintaining a healthy bottom line.
Billing Audits are by nature more comprehensive than coding audits. Hence they cover the entire revenue cycle starting from the eligibility verification process to the denial management processes. The audit may examine all clinical records, financial records and policy-related documents reviewed by payors/government.
Medical Billing Audits do not cover the scope of medical care, medical necessity, pricing of services and services rendered by the physician. These areas are reviewed by other qualified personnel.
The Audit Process
The process of medical billing audits consists of the following steps:
- 1. The Audit team will determine the scope of the audit and the resources needed to complete it efficiently and effectively. For best results, the audit may include studying the work of clinical staff involved, payor mixes, and billing and coding staff composition.
- 2. Assessing the practice as a whole to zero in on areas of increased risk. Therefore the audit can also involve checking the frequency of provider services. As well as analyzing CPT code usage by billing staff and providers.
- 3. For effective and meaningful audits, practices should take corrective action based on audit findings. These findings should serve as strategic information to improve revenue cycle management and care outcomes by setting targets for improvement. Payors may be asked to improve any areas in which they have been found lacking.
Best practices for effective audits
Establishing best practices for billing audits helps to ensure that the audit yields the best results for enhancing the RCM.
• Perform quarterly audits with a qualified person heading up the audit team
• Stay proactive, especially in terms of following payor guidelines
• Maintain open communication between coders and providers
• Monitor days in AR and data from monthly reports to catch trends as early as possible
• Consider tracking growth in net collection percentage
• Create a system that tracks the revenue cycle for each patient from appointment to complete payment
• Focus on areas with the most significant potential for return on investment
• Analyze patient encounters vis-a-vis appointments
• Checkout CPT reimbursements and compare to individual payor contracts to identify underpayments
• Check to make sure no claim is written off at 100%
• Create a process for dealing with claims that are denied or paid incorrectly.
• Support and be proactive with internal audits. Consider having external audits regularly
• Focus on details like principal diagnosis and medication reports as well as high-dollar charges
Benefits of Internal Audit
Internal audits in any organization are an investment always. A few advantages of conducting medical billing audits are
(I) Improved coding accuracy following the latest guidelines
(ii) Identification of potentially problematic areas/processes
(iii) Improved reliability and transparency of the billing system
(iv) Smooth and streamlined workflow of the practice
(v) Strengthened relationship between medical practices and payors
The rules and regulations governing the healthcare industry have become stricter over the years and more complex. For this reason, complying with all rules has become stressful for practices. Hence internal billing audits are a necessity to ensure compliance and a healthy bottom line.
Bristol Healthcare is always by your side
Bristol Healthcare Services, a medical billing and coding company, will help you conduct regular medical billing audits. With our two decades of experience in the healthcare industry, our certified team can audit your RCM and suggest ways to improve your systems and processes. We will assist you to stay compliant and also enhance the profitability of your practice.
Talk to an expert today!