Corporate Compliance

1. How to prepare an audit report
2. Tips for interviewing and evaluating new auditors
3. Gov't audit insider

Healthcare Auditing Weekly, July 1, 2003

Health Care Auditing Strategies
NEW Newsletter
Guide to Compliance Auditing: Applying OIG Techniques and Tools
Strategies for Health Care Compliance
July 29, 2003
Vol. 1, No. 13

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Auditing news and tips

Sample audit programs (For subscribers to Health Care Auditing Strategies only)

Sample compliance policies and procedures. (For subscribers to Strategies for Health Care Compliance only)

The OIG Work Plan for Fiscal Year 2003

Ask the Expert

Tip of the Week

Compliance Hot Topics: Auditing, Billing and Coding, EMTALA, Stark, HIPAA

Question of the Week

In This Week's Issue

  1. How to prepare an audit report
  2. Tips for interviewing and evaluating new auditors
  3. Gov't audit insider

This Week's Headlines

1. How to prepare an audit report

Auditors should report significant audit findings and, where applicable, their conclusions. Here are some tips on reporting findings and conclusions. This information is covered in the book, "Guide to Compliance Auditing: Applying OIG Techniques and Tools."

Reporting findings:
1. Document results. Your audit is not complete until you report results to the auditee in writing.
2. Report the significant findings developed in response to each audit objective.
3. Separately tell auditees about any insignificant audit findings you did not include in the report. It's best to do this in writing. And if you share these 'insignificant' findings with management (as you should do in a letter), make sure you also refer to them in the audit report.
4. Document all communications of audit findings in the working papers. In reporting the findings, include sufficient, competent, and relevant information. Do this for two reasons: one, to promote adequate understanding of the matters reported; and two, to provide convincing but fair presentations in proper perspective.
5. Report appropriate background information readers will need to understand certain findings.

1. Report conclusions when the audit objectives require it. Conclusions are logical inferences about the program, based on the findings.
2. Specify your conclusions; readers should never have to infer what they are. The strength of your conclusions depends on the persuasiveness of the evidence supporting the findings and the soundness of the logic used to formulate the conclusions.

For more information on writing credible and convincing audit reports, as well as ideas on planning a compliance audit, ready-to-use standards and working papers the Office of Inspector General uses, step-by-step audit programs for areas such as research and bad debts, plus information on how to apply the Government Auditing Standards to your own compliance and monitoring program, order the book "Guide to Compliance Auditing: Applying OIG Techniques and Tools."

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A how-to resource for conducting successful internal investigations and audits

The new book, "See for Yourself: A Health Care Provider's Guide to Conducting Internal Investigations and Audits," will show you how to conduct your own internal investigations and audits from start to finish. It offers practical advice and real-life examples on how to plan and staff an internal investigation or audit, and provides detailed information on the legal issues involved.

To order, or learn more, go to: Or, call 800/650-6787 and mention source code EB1054A.

2. Tips for interviewing and evaluating new auditors

When hiring a new auditor, try the same methodical approach you use to audit. By organizing your search, you will choose the most qualified auditor.

Use the following steps for interviewing and evaluating new auditors:

1. Identify necessary qualifications
Choose auditors based on the role they will fill, says Laurisa Riggan, CPA, vice president of corporate compliance and internal audit for Children's Mercy Hospitals and Clinics in Kansas City, MO. Keep the following rules in mind when filling these positions:

  • Medical auditors-They need a clinical background. "Nurses are a great fit for this role because they have such an extensive knowledge of all types of services," says Riggan.
  • IT auditors-They need extensive knowledge and experience of networks and systems, preferably with the type and versions that your facility uses.
  • General auditors-Look for people with an accounting background and experience in the health care industry.

    Must-have "how to" secrets!
    For more information on the necessary qualifications for an internal auditor, as well as tips to help you decide where to look for new employees, how to interview the applicant, how to identify red flags, how to choose the best auditor, and how to hire new auditors, order the pay-per-view article "
    Tips for interviewing and evaluating auditors." The article costs $10. Subscribers to the online version of Health Care Auditing Strategies have free access to it. Subscribers to the print edition can find it in their July issues.

    Or for only $23 per month, you can get even more auditing best practices and how-to articles by subscribing to Health Care Auditing Strategies. Save 10% by ordering online.

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    Network with your audit colleagues

    "Audit Talk" is a new, moderated chat forum that members can use to post messages or questions for their peers 24-hours-a-day. "Audit Talk" offers a free forum to network, share ideas, and solve problems for those in the audit industry. Getting involved is easy. To subscribe, just send your request to this e-mail:


    Excessive Medicare payments

    The Office of Inspector General (OIG) did the following to review potentially excessive Medicare payments at Empire Medical Services, a Medicare fiscal intermediary.

    Objective: The OIG's objective was to identify potentially excessive Medicare payments Empire Medical made to institutional providers for outpatient and Part B services during calendar year (CY) 2000 and 2001.

    The OIG did the following to accomplish its objective:

  • Reviewed applicable Medicare laws and regulations
  • Used Centers for Medicare and Medicaid Services' (CMS) National Claims History file to develop frequency distributions of claim paid amounts for outpatient and inpatient items reimbursed under Medicare Part B and paid during CY 2000 and 2001
  • Used the above frequency distributions to identify outpatient claims that had Medicare claim paid amounts equaling or exceeding $50,000
  • Reviewed the available CY on-line claim histories for these claims to determine whether they had been cancelled and superseded with revised claims
  • Contacted Empire Medicare personnel to advise them about the review and its objective, and discuss and obtain information for 136 selected claims (inpatient and outpatient)

    Tip: The OIG requested information about outpatient and Part B claims with questionable line item charge amounts.

    To read the audit report "Review of Potentially Excessive Medicare Payments - Empire Medicare Services," click here.

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    In addition to each 12-page monthly newsletter, Health Care Auditing Strategies (HCAS) subscribers receive the following benefits:

  • Audit talk-This is a free forum to network, share ideas, and solve problems for HCAS subscribers.

  • Audit advantage-Readers log on each month to the HCAS subscriber-only Web page that lists sample audit plans and government documents. Go to and enter the password that is printed in each issue of HCAS.

  • Fax and email alerts-When there's late breaking news that just can't wait until the next issue of HCAS, we'll fax or email the pertinent information to you immediately.

  • Editorial special reports-When there's a new regulation or news on laws related to health care auditors, our expert writers gather the necessary information and compile a special report. Subscribers received a free special report on the Sarbanes-Oxley Act with their May issues.

    Take advantage of these subscriber benefits, as well as auditing best practices and how-to articles by subscribing to Health Care Auditing Strategies. Save 10% by ordering online.


    To learn more about the Sarbanes-Oxley Act and how it affects internal auditors and compliance officers, order the special report "Sarbanes-Oxley Act: Impact on Health Care Organizations"

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