Corporate Compliance

1. Internal investigations: Six tips for interviewing employees
2. Billing: The ins and outs of auditing observation services
3. Gov't audit insider

Healthcare Auditing Weekly, August 11, 2003

Health Care Auditing Strategies
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August 12, 2003
Vol. 1, No. 15

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In This Week's Issue

  1. Internal investigations: Six tips for interviewing employees
  2. Billing: The ins and outs of auditing observation services
  3. Gov't audit insider

This Week's Headlines

1. Internal investigations: Six tips for interviewing employees

One of the most dependable ways to determine facts in an internal investigation is through employee interviews. Your goal in conducting an internal investigation is to obtain truthful information, preserve the attorney-client privilege, fulfill your ethical obligation, and minimize the company's criminal and legal exposure. Use the following tips to accomplish these goals:

1. Make sure the employee understands that you are working on behalf of the company-not the employee.

2. Establish that the interview is being conducted within the bounds of attorney-client privilege. Explain that the privilege belongs to the company, not the employee. The company may decide to share the details of the investigation without the employee's consent or knowledge.

3. Remind employees when necessary that they are required, as a condition of their employment, to cooperate and tell the truth.

4. Advise employees not to tell anyone that they have been interviewed or share contents from the interview to prevent rumors from flying and future witnesses from being forewarned.

5. Reassure the employee that there will be no retaliation against him or her for cooperating with the investigation or for speaking to the government.

6. Instruct the employee about his or her rights and responsibilities if a government investigator contacts him or her.

For more information on how to conduct an internal investigation, order the book "See for Yourself: A Guide to Conducting Internal Investigations and Audits." This book 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, such as attorney/client privilege, obstruction of justice, and legal obligation to disclose results. Click here to order.

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Coding audit training for HIM managers

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For more information or to purchase, CLICK HERE, or call our Customer Service team at 800/650-6787. Mention Source Code EZ22610A when you call.

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    2. Billing: The ins and outs of auditing observation services

    Most people misunderstand observation services and bill for then inappropriately, says Marianne Labahn, RN, BSN, MS, director of compliance and chargemaster for the Cancer Treatment Centers of America in Arlington Heights, IL. This can get you in trouble. "Medicare reviews whether it needs to pay facilities for an additional diagnosis. If Medicare finds out that you are using bad data, this could bring up fraud and abuse issues."

    Audit your observation services to identify problems, such as patterns of long lengths of stays without coinciding orders, says Day Egusquiza, president of AR Systems, Inc., a consulting firm in Twin Falls, ID.

    Focus your audit
    Susan Parker, BSN, RN, LNCC, CCS, a consultant with the national consulting firm Parente Randolph, LLC, says auditing your organization's observation services is important because it does the following:

  • Ensures that your organization is properly coding and billing observation services
  • Identifies departments that need more education. "With the ever-changing rules and regulations, organizations must provide regular and consistent educational updates to staff and physicians," says Parker.
  • Provides an ongoing review of the patients admitted to observation status.

    To find out how to audit your organization's audit services, order the pay-per-view article ""Billing: The ins and outs of auditing observation services." 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 August 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:

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    On-demand payments

    The OIG audited the Kentucky Department for Medicaid Service (DMS) to account for on-demand payments to nursing facilities. It also reviewed whether DMS used appropriate collection efforts to recoup interim payments, and accounted for the federal share of write-offs and overpayment adjustments. The OIG found that DMS overpaid nursing facilities $234,466 for the period of October 1, 1999 through September 30, 2002.

    The OIG used the following scope and methodology for this audit:

    The OIG covered on-demand payments DMS made from October 1, 1999 through September 30, 2002; the status of interim payments as of January 24, 2003; and the write-off and adjustment of receivables for the quarters ending September 30, 2002 and December 31, 2002.

    The OIG did the following as part of its audit:

  • Met with individuals at the Centers for Medicare and Medicaid Services (CMS) to discuss requirements for reporting of overpayment adjustments and write-offs and to obtain an understanding of issues relevant to the current review
  • Met with officials from the Kentucky Auditor of Public Accounts to discuss audit work they performed in connection with DMS' policies and controls governing receivables and on-demand payments
  • Obtained and reviewed necessary documentation from the DMS offices
  • Issued a draft report to DMS on May 27, 2003. DMS declined a formal exist conference.

    Click here to read the OIG audit report "Audit of the Kentucky Department for Medicaid Services' On-Demand Payments, Interim Payments, and Write-Off and Adjustment Process."

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    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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