1. Let Auditing Be Your Superpower
Joseph Newsome, CPC, COC, CPCO, CPMA, CPPM, CPC-I, CEMC, AAPC Fellow

2. Learning Objectives The Importance of Auditing The Auditing Process
How to apply the components of the auditing process to our regular task as check and balance.

3. The Importance of Auditing
Medical record auditing entails conducting internal or external reviews of documentation coding accuracy, policies, and procedures to ensure that practitioners are compliant and meet all coding and billing regulations of the payer when submitting a claim. Audits may be conducted internally by the practice or by an independent consultant or coding auditor working outside of the medical practice.
Source: Medical Record Auditor 4th Edition

4. Internal Audit
The internal audit is conducted to find and correct inconsistencies with documentation and coding before an insurance carrier uncovers the errors.
Source: Medical Record Auditor 4th Edition

5. External Audit
External audits are conducted by a third-party payer or government agency to validate that the documentation supports the insurance claim submitted to the carrier. Payers often will request a few medic al records as a sample, or conduct a focused review if there is any suspicion of inappropriate payment.
Source: Medical Record Auditor 4th Edition

6. Reasons to perform Medical Audits
There are many reason to perform medical audits.
Some reasons are:
To determine outliers before payers find them and request a carrier audit.
To protect against fraudulent claims and billing activity.
To reveal whether there is variation from national averages due to inappropriate coding, insufficient documentation, or lost revenue.
To identify and correct problem areas before insurance or government payers challenge inappropriate coding.
Source: Medical Record Auditor 4th Edition

7. Reasons to perform Medical Audits
To prevent governmental investigational auditors like recovery audit contractors (RACs) or zone program integrity contractors (ZPICs) from knocking at your door.
To remedy undercoding, overcoding, upcoding, unbundling habits, and code overuse.
To bill appropriately for documented procedures and services.
To identify reimbursement deficiencies and opportunities for appropriate reimbursement.
To stop the use of outdated or incorrect codes for procedures or diagnoses.
Source: Medical Record Auditor 4th Edition

8. Benefits of Medical Record Auditing
Medical record auditing provides the following benefits:
Improves quality of care
Increases productivity
Meets compliance standards
Prevents inappropriate coding (over- and undercoding)
Source: Medical Record Auditor 4th Edition

9. The Auditing Process
It helps an organization accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control, and governance processes. The audit process is generally a ten-step procedure.
Source: Medical Record Auditor 4th Edition

10. The Auditing Process and How to Apply the Components
1. Notification
First, you will receive a letter to inform you of an upcoming audit. The auditor will send you a preliminary checklist. This is a list of documents (e.g. organization charts, financial statements) that will help the auditor learn about your unit before planning the audit.
Source:

11. The Auditing Process and How to Apply the Components
2. Planning
After reviewing the information, the auditor will plan the review, conduct an engagement risk assessment, draft an audit plan, and schedule an opening meeting.
Source:

12. The Auditing Process and How to Apply the Components
3. Opening Meeting
The opening meeting should include senior management and any administrative staff that may be involved in the audit. During this meeting, the scope of the audit will be discussed. You should feel free to ask the auditors to review areas that you are concerned about. The time frame of the audit will be determined, and you should discuss any potential timing issues (e.g. vacations, deadlines) that could impact the audit. It doesn't take as much of your time as you might expect!
Source:

13. The Auditing Process and How to Apply the Components
4. Fieldwork
After the opening meeting, the auditor will finalize the audit plan and begin fieldwork. Fieldwork typically consists of talking with staff, reviewing procedure manuals, learning about your business processes, testing for compliance with applicable university policies and procedures and laws and regulations, and assessing the adequacy of internal controls. You should make your staff aware that the auditor will be scheduling meetings with them.
Source:

14. The Auditing Process and How to Apply the Components
5. Communication
Throughout the process, the auditor will keep you informed, and you will have an opportunity to discuss issues noted and the possible solutions.
Source:

15. The Auditing Process and How to Apply the Components
6. Report Drafting
After the fieldwork is completed, the auditor will draft a report. The report consists of several sections and includes: the distribution list, the follow-up date, a general overview of your unit, the scope of the audit, any major audit concerns, the overall conclusion, and detailed commentary describing the findings and recommended solutions. You should read the draft report carefully to make sure there are no errors. If you find a mistake, inform the auditor right away so that it can be corrected before the final report is issued.
Source:

16. The Auditing Process and How to Apply the Components
7. Management Response
Once the report is finalized, we will request your management responses. The response consists of 3 components: whether you agree or disagree with the problem, your action plan to correct the problem, and the expected completion date.
Source:

17. The Auditing Process and How to Apply the Components
8. Closing Meeting
A closing meeting will be held so that everyone can discuss the audit report and review your management responses. This is an opportunity to discuss how the audit went and any remaining issues.
Source:

18. The Auditing Process and How to Apply the Components
9. Report Distribution
The report is then distributed to you, your manager(s), senior university administrators, internal audit, and the university's external auditors. We also distribute an audit survey to the audited unit to solicit feedback about the audit. Feedback is important to us, since it can help us improve the audit process.
Source:

19. The Auditing Process and How to Apply the Components
10. Follow-up
Follow-up reviews are performed on an issue-by- issue basis and typically occur shortly after the expected completion date, so that agreed-upon corrective actions can be implemented. The purpose of the follow-up is to verify that you have implemented the agreed-upon corrective actions. The auditor will interview staff, perform tests, or review new procedures to perform the verification. You will then receive a letter from the auditor indicating whether you have satisfactorily corrected all problems or whether further actions are necessary.
Source:

20. Check and Balance
Use a system of checks and balances to ensure no one person has control over all parts of charts.
Example: Proactive Monitoring - If this process is not conducted on an ongoing basis, incorrect or inappropriate documentation and coding practices, potential risks to the organization, compliance with the organization’s policies and procedures, and compliance with payer regulations may not be identified.
Source:

21. Check and Balance
Educate your staff on the standards of care approved by your organization. Not all clinicians are able to learn in the same way.
Investigate the best method of teaching your staff, just as you would your patient. For example, some physicians and clinicians are visual learners, as opposed to learning by listening to a presentation.
Educate, reeducate, and support the staff of the facility.
Source: