Medicare Audits

3 Things You Need To Know About Medicare Audits

Healthcare facilities across the nation have or will have to face Medicare audits at some point.  Even those healthcare facilities that have done everything correctly and have never had to face an audit till date cannot be certain that it may not happen in the future.  An audit could be due to a single payment or a multitude of payments – in either case, each audit is important and cannot be ignored – even if you believe that the single payment being audited is not important enough to justify and answer to the audit.

According to CMS, an audit is performed to “identify improper Medicare payments and fight fraud, waste and abuse in the Medicare program.”  In an effort to reduce money spent on improper Medicare payments, CMS has increased their efforts to bring down payment errors.  It is important to remember that, “Although all fraudulent claims are improper payments, not all improper payments are fraudulent claims; most are due to documentation errors.”  Irrespective of the motives or errors by the healthcare facility, an audit is ordered if the CMS believes that an improper payment has been made. The various kinds of audits that are performed are:

  • RAC (Recovery Audit Contractor) audits
  • CERT (Certified Error Rate Testing) audits
  • Probe audits

Errors can occur even after taking all precautions – and errors invite audits.  In order to be able to sail through these audits, you need to be fully prepared, and in order to be prepared, there are some things that you need to know about these audits.

Documentation is the key

Documentation is one of the biggest culprits that invoke audits.  Check and re-check all documents before sending and ensure that the following mistakes do not occur.

  • Non-compliance with CCI edits and / or the 8-minute rule
  • Certifications missing in the patient’s care plan
  • Adequate PTA supervision not provided
  • Stamping a signature in place of physically signing the document
  • Physician or therapist signature illegible
  • Physicians signature missing from the document
  • Plan of care not recertified if required
  • Records not supplied to Medicare if requested
  • Documentation not sufficient
  • Modifications made to documents post-denial of the claim.

Billing errors to avoid

To err is human – but billing errors are certain to arouse suspicion and lead to an audit.  As with your documentation, ensure that your billing is error free to avoid an audit.  Some billing practices that instantly arouse Medicare’s suspicion are given below:

  • Billing incorrectly for services provided by therapy techs or aides
  • Billing for co-treatment in the absence of any co-treatment provided
  • Patient was part of a group therapy, but billing done for a one-on-one session
  • Claim for services that do not meet Medicare’s “reasonable and necessary” definition
  • Unbundling and / or upcoding through the coding system
  • Providing non-medically necessary services before executing an ABN and then billing under medical necessity
  • Billing for services furnished by a student

Knowledge is power

Ignorance of the law is not an acceptable defense – it is important that your staff members are aware of Medicare’s Local and National Coverage Policies.  Ensure that your staff members join Medicare related CEU courses and / or go through Medicare compliance training programs.  Your compliance officer should have a compliance plan and this should be adhered to by all concerned staff members.  Your facilities compliance plan should contain:

  • A defined standard of conduct for the facility
  • Responsibilities of the compliance officer
  • Explanations on internal audits
  • Risk areas to be avoided

Get help with your audits

While there is no doubt about your facilities ability to manage an audit, it helps if you have an agency to help your facility take care of these audits.  MedConverge has been helping their clients with their RAC audits by providing all aspects of RAC audit requirements on a common centralized platform. For more information on our services, contact us on

About the Author:MedConverge

Leave a Comment