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Consider keeping your chart audits under wraps with attorney-client privilege

HIM Connection, June 10, 2003

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Dear Colleagues:

If your facility uncovers a problematic coding and billing problem, it may be appropriate to consult an outside attorney. The attorney-client privilege has significant historical roots. Generally, the privilege protects communications between an attorney and his or her client. These two terms, "attorney" and "client," are important in the application of the privilege. In a 1981 case, the court noted that the privilege protects from disclosure communications that are all of the following:

1. received in confidence

2. between a client and an attorney

3. for purposes of obtaining legal advice

Application of the attorney-client privilege is determined on a case-by-case basis. This makes the privilege itself somewhat tenuous. The safest way to preserve the attorney-client privilege is to engage outside counsel adhering to specific pre-established guidelines. The hospital must be willing to abide by the limitations and standards the attorney places on the relationship. Management must implicitly understand how the attorney-client relationship will alter the hospital's behavior. The hospital must accept the legal, operational, and economic ramifications of the attorney-client relationship designed to protect audit findings.

If the attorney-client privilege protection is going to be successful in court, the hospital must do the following.

1. Delegate control to outside counsel. The hospital may only share audit information with very limited parties (usually top-level managers). Furthermore, audit results may not be shared with the HIM department for feedback and comments. All communications regarding the audit must be funneled through the attorney. The hospital should not communicate with the audit firm directly. These are just some constraints of the relationship. The bottom line is that the hospital must give up most of its control over the audit process and entrust a great deal to the outside law firm.

2. Implicitly trust the competency of both the law firm and the audit firm. To do this, hospitals should be sure to retain outside counsel with experience in attorney-client privileged audits and health care reimbursement audits. The audit firm should also have experience with attorney-client privileged situations. This is a highly sensitive area and should not be one that the hospital leaves open to chance-even if it means not dealing with the same law firm or audit firm the organization has depended on for a decade.

3. Determine whether the added expense is worth the added protection. You cannot put a price tag on the legal protection the law firm may bring to your audit process, but you still need to be prepared for the additional expense. The hospital should perform a cost-benefit analysis so that it can justify its decision to retain-or not retain outside counsel. In the end, the hospital's decision must rest on both the legal and compliance competency of the law firm, as well as the law firm's experience with reimbursement audits.

This week's HIM Connection was excerpted from the book, Coding Compliance: A Practical Guide to the Audit Process. With this book, you'll be able to keep the auditing of your medical records and coding compliance in-house to avoid costly consulting fees.

Sincerely,

Laura Motta
Editorial Assistant

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