All audit requests must be taken very seriously. Payors tend to copy what other payors are doing, and a problematic audit with one payor can cause other payors to initiate their own audits. Therefore, it is critical to respond appropriately to each audit request. Also, auditors often only check a few billing records. If errors are found, they will then extrapolate those findings, and the provider may be penalized.

Upon receipt of an audit request, it is important to immediately engage legal counsel well-versed in handling payor audits. Having an attorney who understands the audit process and has experience responding to audit requests can help ensure the best possible audit outcome. A negative outcome could result in recovery of overpayments, civil and/or criminal penalties, and exclusion from government programs.

Providers should work with such legal counsel to review the audit request and supply everything reasonably requested. A concerted effort should be made to submit all information to the auditor at one time. If information is missing, the auditor may determine that a significant error rate exists, which could cause the auditor to review all CPT codes to calculate the overpayment made to the provider. If it is not possible to gather the requested material before the auditor’s deadline, an extension should be requested. Any extensions granted should be documented.

It is important that an audit response and supporting documentation be thorough, clear, and concise. It should be submitted in a manner that allows the auditor to quickly review the information and understand the provider’s arguments. It should clearly state what measures the provider has already taken to terminate existing problems and prevent future issues. Competent legal counsel will be able to address procedural, legal, or factual flaws in the auditor’s position.

Advanced Preparation

The best way to ensure compliance and audit readiness is to develop and implement a compliance plan well in advance of any audit. Experienced legal counsel should play a pivotal role in development of such plan. As always, periodic self-audits or independent audits are necessary to proactively identify compliance issues and mitigate their impact.

Finally, regular and periodic training and education should be conducted regarding audit response obligations and responsibilities. Performing these tasks will help ensure a smooth audit experience with minimal infractions and penalties. TH