Importance of Yearly Coding Audits

Importance of Yearly Coding Audits

We see the word “audit” and automatically we want to shut our eyes and look the other way. What does an audit mean? It means someone is going to be digging deep, finding the cobwebs in the system, the misplaced file, the misspelled names, the incorrect or outdated codes – it means shining a bright light on all the dark recesses of the business that for the most part may be ignored or overlooked.

No one likes audits. No one has TIME for audits. But wait, would you MAKE time when you realize that your yearly coding audit, when left unchecked, could be costing you thousands of dollars in revenue?

Suddenly coding audits became much more interesting.

So, what REALLY is a coding audit?

Coding audits identify new laws, regulations, payer rules, and other issues that affect your specialties. The audit helps you apply new codes and changes correctly from the beginning. Think about where revenue is lost as unoptimized front end processes lead to denied claims, longer lead times, and more manpower. A coding audit helps by ensuring compliance and correctness from the start.

What happens if you don’t do your yearly coding audit? (Dare we ask!)

With most healthcare organizations formalizing compliance programs, the need for medical coding audits is clear. The consequences of not auditing medical code include exposure to compliance risk and lost revenue. Not only do practices run the risk of losing revenue, but it also inhibits the visibility of the things the practice is doing right-areas where financial wins are identified and can be duplicated for better revenue management. Let’s talk a bit more about the benefits of a yearly coding audit in the next section.

Why do you need an audit?

Financial health benefits aside, coding audits provide insight into the process of coding itself. The U.S. Department of Health and Human Services (HHS) Office of Inspector General (OIG) has developed several healthcare compliances programs, and within the key elements of these programs you will find forms of auditing, along with monitoring.

Regular audits can reveal inaccuracies such as outdated codes or even fraudulent billing. These audits provide a quality assurance process that helps organizations obtain proper reimbursement and maintain regulatory compliance.

Discovering Problematic Trends

Remember that bright shiny light we mentioned at the start of the article – Yep – here is where the audit helps identify areas that may be trending in the wrong direction therefore creating problems. An audit helps to identify issues such as under or up-coding, unbundling, outdated coding, and lack of documentation – all things that can adversely affect revenues for a practice or provider.

Medical coding audits not only uncover problems and opportunities to improve, but they also highlight what coding processes are being done right. There are multiple reasons to audit medical coding, but it ultimately boils down to protecting your organization.

Medical coding audits can uncover improper billing practices, whether caused by error or fraud. Healthcare organizations can make the proper updates to billing protocol and staff training to ensure further billing mistakes and intentional fraud are not committed, ultimately reducing risk, and potentially saving organizations from being slapped with hefty fines. (aka – lost revenues!)

Protecting the Revenue

Inaccurate coding leads to healthcare organizations losing money and can result in denied and rejected claims. When a payer reviews and processes a claim only to deem it unpayable, the claim is considered denied. This can occur due to coding errors caught after processing or because the claim goes against the provider-payer contract. Rejected claims do not even make it through the payer review process due to multiple errors. Whether a claim is rejected or denied, it will take time to correct the errors and resubmit the claim to receive reimbursement.

In other cases, claims with inaccurate coding will make it through the payer process. Under-coded claims leave money on the table, while up-coding leaves healthcare organizations vulnerable to regulatory fines. Medical coding audits will find areas in the coding process that lead to lost revenue. Afterward, healthcare organizations can adjust their coding processes to avoid future damage to the bottom line.

We are here to help

An external coding audit gives providers an objective, third-party assessment of their medical coding procedures and policies. If you are looking to improve compliance and prevent lost reimbursement, independent medical coding audits are a great place to start.

As your coding partner, Alta can improve coding accuracy, reduce risk of compliance issues, and provide continuous education on the latest coding regulations. Alta Chart Audit Services includes a thorough review of charts for completeness, accuracy and compliance for CPT, ICD-10-CM, HCPCS and modifier usages that are paired with the best advice for improvement based on the findings.

Contact us to set up your yearly coding audit or to learn more about Alta’s RCM solutions and services.