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Ophthalmology Management

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The Efficient Ophthalmologist

Schedule regular practice audits

By: Steven M. Silverstein MD, FACS
Ophthalmology Management December 1, 2013
THE EFFICIENT OPHTHALMOLOGIST

The importance of scheduling regular practice audits

External audits help keep you in compliance.

By Steven M. Silverstein MD, FACS

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Steven M. Silverstein, MD, FACS, is a cornea-trained comprehensive ophthalmologist in practice at Silverstein Eye Centers in Kansas City, Mo. His e-mail is ssilverstein@silversteineyecenters.com.

We have just completed an external audit of our practice. We will initiate a self-ordered audit every three to four years. This appears to be a healthy frequency, although there are no norms, and if you have not performed an external audit, or it has been quite some time since your last one, I hope that this column serves as appropriate motivation to proceed.

WHY AN EXTERNAL AUDIT?

Several key reasons exist for having your practice audited by an outside organization, although these may seem like hard dollars to spend in the current environment.

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From a regulatory standpoint, compliance programs are mandatory according to the Affordable Care Act, although it sets no dates for their implementation. Auditing will be a critical component of every compliance program, and several reputable organizations will perform an external audit. We have worked with at least three different companies over the years. Each experience has illuminated aspects of our practice that will benefit from change.

BENEFITS OF EXTERNAL AUDITS

The staff members who are most appreciative of the external audit process are those who work in insurance, billing and collections. They learn about new coding initiatives, develop new techniques for filing clean claims that reduce denials, or how to refile expedited scrubbed claims after the carrier kicks them back. Perhaps most important, the auditors’ efforts to “school” the doctors and scribes to properly document and code are reiterated and pay dividends in the form of more claims that get promptly paid.

Doctors do not like to be bothered by such things as proper documentation to justify a specific level of coding. It is the responsibility of those in billing and collections to keep us from getting ourselves in serious trouble — trouble that may result in very serious overpayments and possible fines.

PAYERS ARE IMPRESSED

According to Donna McCune from Corcoran Consulting Group, who has performed the last two audits in our practice, “Having a compliance program that includes proactive audits is viewed favorably by payers as they see that compliance is a priority for the practice. It is difficult for a payer to allege fraudulent behavior when the practice is policing itself for errors, and corrects any errors found in the process.”

Indeed, before the sequester, the Office of Inspector General (OIG) received a significant increase in funding to hire more personnel to conduct surprise audits. Though the overwhelming majority of physicians mean well and would not knowingly attempt to bill fraudulently, naiveté is not considered an appropriate defense. Such errors cost practices millions of dollars in overpayments, possible fines, legal and consulting expenses, and significant angst.

REPORTING AUDIT RESULTS

Audit results may be reported in a variety of ways. Corcoran Consulting Group typically provides its results under two headings:

  • Subjective. This section looks at chart neatness, legibility (less of an issue with EHR) and chart organization. The findings are organized by type of error and assigned to the physician or physicians responsible.
  • Objective. The objective section highlights issues and errors pertaining to billing, coding, modifiers, diagnosis and incorrect dates. The report organizes these findings by how frequently they occur and the financial impact they have on the practice.

Audits are typically conducted by randomly pulling 10 charts or so of each physician that represent the typical types of services he or she performs. With this method, patterns of behavior emerge specific to a given physician, service, office location, specialty or payer.

The auditing process

A variety of approaches can be used for an audit. They include:

  • A prospective review performed before claims are filed to catch errors that may result in an improper payment.
  • A retrospective audit assesses claims already filed, which may result in refunds of overpayment.
  • An external audit is conducted by an outside professional, such as a consultant, attorney or accountant, who investigates your methods of billing, coding and documentation. The auditor also weighs in on the ethical behavior of the practice in areas such as marketing and informed consent to ensure compliance. The auditor is also instrumental in providing a methodology for performing regular internal audits.
  • An internal audit is conducted by designated staff and physicians in the practice employing techniques learned in the external audit. This is a cost-effective way to ensure ongoing compliance, to educate new staff or those not properly coding or documenting, and to flag areas of concern such as overbilling for certain levels of service that may result in refunds to patients or third-party payers.

Checks on coding frequency

Auditing also serves to investigate the pricing structure for billable services and the frequency at which these services are billed. For example, an examiner employs national and regional metrics that determine how often a specific level of coding is likely to occur, or how often modifiers should be used. If a physician or practice falls above or below this metric, a red flag is raised.

If the average comprehensive ophthalmologist bills a complete, high-level exam 30% of the time and a given practitioner is using this high level code 60% of the time, this behavior will stand out. It may be perfectly appropriate for the practitioner to be doing so as a consultant (i.e., cornea, retina, neuro), but the exams must be carefully documented to stand up to scrutiny. On a positive note, quite often practices learn that in an attempt to avoid falling out of compliance, they are coding and billing well below what the exam and documentation should appropriately collect. External audits not only uncover such behavior, but also help initiate the refiling of claims to capture this higher deserved level of reimbursement.

FINAL REVIEW OF AUDIT FINDINGS

At the end of the investigation, the auditor spends several hours reviewing the findings, first one-on-one with the people in the billing and collections department, followed by a meeting and PowerPoint presentation with the entire staff to point out what the practice is doing right, where areas of improvement are necessary, and how it compares with national benchmarks. Finally, the auditors create a report and review it with the physicians privately.

Great peace of mind follows an audit, as the complexity of our environment is intimidating and we simply cannot keep up with this ever-changing milieu. In the near future looms the transition to the ICD-10 codes. If EHR did not drive you into early retirement, this just may do it. OM

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