HIM 600 Module 6 Auditing Short Paper Example

Looking Where the Risk Is: Audits, Samples and Screens for Sawtooth Bone and Joint

[Student Name]

Southern New Hampshire University

HIM 600: Managing Compliance

Module Six Short Paper

[Instructor Name]

[Date]

The organization, setting and figures below are a composite written as a model document. No real employer, client, colleague or patient is described.

Looking Where the Risk Is: Audits, Samples and Screens for Sawtooth Bone and Joint

A practice cannot audit everything, and an audit plan that spreads effort evenly will spend most of it where little goes wrong. Sawtooth Bone and Joint, the composite Boise bone and spine practice used throughout this course, has just finished its first record review, in which 18 of 40 level five visits and 11 of 20 modifier 25 injection claims failed. This paper designs the ongoing audit and monitoring plan that follows. It explains how risks are ranked, what kinds of review are used, how many claims are drawn and when, and how results are reported. Federal guidance places continuing risk review, audits and monitoring among the program parts every organization needs and treats them as constant work, not a yearly event (U.S. Department of Health and Human Services, Office of Inspector General [HHS-OIG], 2023).

Ranking the Risks

The compliance committee scored eight billing areas from one to five for likelihood, based on the record review, billing data and staff interviews, and from one to five for impact, based on dollars at stake, the number of patients affected and legal exposure. The product gives a risk score out of 25. Table 1 shows the results. Office visit levels and modifier 25 lead because the review has already shown errors there and both involve thousands of claims a year. MRI referrals score high on impact because a failure of the in-office exception affects every scan billed, even though the likelihood is judged lower. Physical therapy plans of care, brace billing, surgical assistant claims, advanced practice billing and diagnosis specificity follow. The ranking is revisited each year and whenever a new guideline, payer policy or enforcement report changes the picture.

Table 1. Risk Assessment of Eight Billing Areas

Note. Scores set by the compliance committee from the record review, billing data and interviews.

Prospective and Retrospective Review

The two highest risks start with prospective review, in which a coder checks claims before they are submitted and queries the clinician when documentation does not support the level or modifier selected. Prospective review prevents new errors and gives clinicians immediate feedback, which the record review found to be missing. It is costly, so it runs for each clinician only until that clinician reaches an accuracy rate of 90% on two consecutive monthly samples. Retrospective review, of claims already paid, measures how well the program is working and identifies overpayments that must be returned. Lower-risk areas use retrospective review only, at the frequencies in Table 1.

How Many Claims

Sample size depends on the purpose. To learn whether a clinician has a problem, the plan uses a probe of ten claims per clinician per area, chosen at random from the period under review. A probe answers a yes-or-no question and cannot support an estimate of total overpayment. If a clinician's probe shows an error rate above 10%, the review expands to a discovery sample of 30 claims, and if that confirms a pattern, the committee consults counsel about a statistically valid random sample. A statistically valid sample is drawn and analyzed with a documented method, such as the federal RAT-STATS software, so that the result can be extrapolated to the full set of claims with a stated confidence and precision (U.S. Department of Health and Human Services, Office of Inspector General, n.d.). Extrapolation matters when an overpayment must be estimated for refund or disclosure. The plan records every sample's frame, method and seed so that any review can be repeated by an outside auditor.

Monitoring Between Audits

Audits are snapshots, so the plan adds monthly monitoring reports that need no record pulls. The first compares each clinician's distribution of office visit levels with the group's and with published specialty distributions, flagging anyone whose share of the highest level is far above peers. The second calculates, for each clinician, the share of injection visits billed with a separate visit and modifier 25. The third estimates billed hours. Fang and Gong (2017) showed that adding up the typical time of the services a physician bills can reveal physicians who bill for more hours than anyone could work, and that the excess pointed toward overbilling. At Sawtooth, any clinician whose implied hours exceed 60 a week in clinic will be reviewed. A flag is not a finding; it directs the next probe.

Reporting and Independence

The committee sees results at each monthly meeting, and the managing partners see them twice a year, by clinician and by area, with accuracy rates, dollars at issue and actions taken. Clinicians receive their own results privately with the records reviewed, so they can learn from specific notes. Each year an outside coding firm will audit a random sample of 100 claims across the practice, both to check the internal coders' work and because an independent review is more persuasive to payers and regulators than a practice grading itself.

Limits and Safeguards

The plan has limits that the committee should keep in view. Risk scores rest on judgment, so two reasonable people could rank therapy and brace billing differently, and an area that scores low may simply never have been examined. To guard against that, one low-ranked area will receive an unplanned probe each year. Internal coders also know the clinicians they review, which can soften findings, and that is one reason the outside audit matters. Finally, audit results can feel like accusations. Framing each result as accuracy feedback, sharing the specific notes and recognizing clinicians who improve will make it more likely that physicians treat the audits as help rather than surveillance.

Conclusion

This plan aims audit effort at the areas where Sawtooth's own evidence shows risk, uses the cheapest method that answers each question and escalates only when the data warrant it. It also creates a record that the practice looked, measured and acted, which is the best defense a practice can have when questions come from outside.

References

Fang, H., & Gong, Q. (2017). Detecting potential overbilling in Medicare reimbursement via hours worked. American Economic Review, 107(2), 562-591. https://doi.org/10.1257/aer.20160349

U.S. Department of Health and Human Services, Office of Inspector General. (2023). General compliance program guidance. https://oig.hhs.gov/compliance/general-compliance-program-guidance/

U.S. Department of Health and Human Services, Office of Inspector General. (n.d.). RAT-STATS statistical software. https://oig.hhs.gov/compliance/rat-stats/