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6 Critical Tips to Avoid RAC Audits

March 6, 2018

RAC Audits.jpegMany providers are aware that CMS has increased its Recovery Audit Contractor or RAC audits and commercial payers are also taking a closer look at billing and coding usage. Data analytics usage has enabled payers to identify coding and other “outliers” and in turn, track for audits. With a stated goal of recovering over $2 billion in “improper payments” it’s more critical than ever for practices to be in compliance. While having a good tax preparer on your team can also reduce accounting errors and other red flags, many practices commit documentation and management mistakes that can lead straight to the auditor’s office.

1. Have a Risk-Management Plan in Place

Too many practitioners give the “business” concept lip-service, believing the problem will take care of itself by hiring competent office help and having a tax expert on board, and then focus their attention on delivering care. However, by being pro-active and putting a comprehensive plan in place for assessment of risk for billing issues and other errors and IRS deductions, you avoid situations leading to trouble down the road.

2. Use Task and Employee Performance Checklists 

Just as airline pilots go over a checklist before each flight, your practice needs to track patient experience satisfaction rates, as well as ensure that necessary services or tasks, such as lab test reports, are not being overlooked and visits are correctly documented. Having standards for employee performance further assures that practice tasks and services will help avoid sloppiness, confusion and mistakes that could lead to audits if not corrected.

3. Pay Attention to EHR Templates and Software Up-Coding

One of the problems with use of templates in EHR systems is the risk of auto populating information from a previous patient visit. Unless such information is clinically relevant to the current visit, either avoid it or include notes explaining the relevancy and other specifics addressed in the earlier visit. There is also the possibility of your EHR automatically up-coding billing from auto-generated patient histories, cloning (cutting and pasting the same examination information) and templates. You may want to review these and related issues with your EHR vendor to avoid these problems before they trip you up with an audit.

4. Avoid the Overuse of Levels 4 and 5 in E/M Codes

Just as your billing department needs to avoid under-coding for E/M visits, they need to avoid overuse of levels 4 and 5 as well. Both mistakes will cost your practice revenue, and in the case of over-use, could lead to having to reimburse payers for over payment. For each level of care you must provide visit-specific documentation, with patient history, the examination and the resulting medical decision, out of seven components, that are considered key to defining the level of services.

Download: RAC Audit Checklist – Simple Action Plan for RAC Audit Compliance

5. Control Errors and Expenses with an Independent Audit

Arranging to have your claims procedures independently audited by an outside contractor can turn up billing errors as well as ensure adherence to compliance regulations while improving recovery. Additionally, an audit can uncover questionable expense deductions that could cause trouble with the IRS. Since a one-time internal audit is usually insufficient to show patterns where problems lie, commit to having it done a regular basis over a longer time period.

6. Hire Outside Specialists to Help Audit-Proof Your Practice

M-Scribe’s expertise in coding, billing and other practice management services can help in avoiding an audit by reviewing your practice’s claims management and revenue cycles and helping pinpoint where potential problems might lie. Working with a trusted, experienced billing company can save money in the long term, by sending out clean claims that are in compliance with federal and state guidelines.

Contact M-Scribe at 770-666-0470 or email me to learn more about how we can “make your practice perfect.”


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