Audits are common experiences for health care providers whether you are dealing with a government health care program or a private insurer like Blue Cross Blue Shield or CIGNA. Many are periodic audits conducted on an annual basis, but some come out of the blue with very little notice, if any. Audits may be prompted by a patient or third party complaint and some occur because the government has decided to put a particular type of health care provider under scrutiny. During my experience as a Deputy Attorney General and as a private attorney representing health care providers I have seen audits conducted against providers as diverse as skilled nursing facilities, durable medical equipment suppliers, individual physicians, non-profit large health care providers, laboratories and adult day health care centers. Most of these audits are concentrated on record keeping and documentation to support services billed for, but others are focused on a billing item that looks “suspicious” either because of the volume of the same services billed (e.g. scheduled prescription pain killers) or the high-cost of the item billed (e.g. wheel chairs). Insurers, both governmental and private hate to pay for expensive services or items.
The consequences of such audits are usually financial and result in the provider paying money back to the government or private insurer. However, if the auditors discover a pattern of suspicious activity, these audits are sent to a government prosecuting agency for a closer look toward possible fraudulent activity. Once the government suspects fraud, then a provider can get its provider status suspended until the government investigation is over. If after the investigation, the government believes that the provider has committed fraud the matter is referred for actual prosecution.
How can I help? Call me in at the start of the preparation for the audit if you have warning of the audit. I can review a sample of your billings and the supporting documentation. I can review your Policies and Procedures and if necessary we can up-date or create them to clarify your billing and documentation policies. If the audit is unannounced, you should call me immediately. I can review the scope of the audit and give you a quick sense of the area of concern that the government or private insurer is reviewing and assess your next move. Importantly, I can advise you and your employees regarding how to respond to the auditor’s questions and requests. We will want to keep the situation contained and if there is a problem, convince the auditors that it will be corrected. If there is a fraud problem we still may be able to deal with it on the audit level. If not, at least we will know the likely next steps that the government will take and prepare a strategy of minimizing the damage.