Corporate Compliance

Formal vs. informal audits

Healthcare Auditing Weekly, January 16, 2007

When designing an audit, you need to know whether you will conduct a formal review/audit or an informal review/audit. Do you know the difference?

Formal reviews and audits involve carefully selected areas, outcomes, and samples. Informal reviews and adits are generally much smaller and performed on an ad hoc basis.

Consider the following when designing your audit:

  • which guidelines and/or standards you will use for comparative purposes
  • which computer and/or other automated aids you will use
  • how you will determine the size and sample to be taken and/or developed
  • how you will select and/or develop the sample
  • the process and techniques you will use
  • The guidelines or standards you may use may be quite involved. For instance, coding-documentation reviews and/or medical necessity reviews may depend significantly upon internal organizational standards or external standards and even benchmarks. If you are reviewing observation coding and charging for medical necessity, then the hospitals care paths in this area will probably be used as guidelines.

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