Health Information Management

Consider self-audit before responding to request

JustCoding News: Inpatient, September 12, 2012

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Do you audit records before sending them to your Recovery Auditor? If not, your hospital may be one of many that simply doesn't have the resources to do so.

However,hospitals should consider self-audits for several reasons, says Lori Brocato, product manager at HealthPort in ­Atlanta. These include:
  • Quality assurance (ensuring that all necessary ­documents are included and that you don’t inadvertently mix dates of service or include documents that the Recovery Auditor didn't request)
  • Advance notice of potential denials (knowing beforehand whether a denial is likely as well as the potential financial impact)
  • Extra time for appeals (additional time to gather data to include in a formal Recovery Auditor appeal)
“Another reason to perform the self-audit is to see the potential for any secondary or tertiary payer trying to come back and recover funds as well,” says Brocato.
When Recovery Auditors first began requesting ­records, many hospitals performed self-audits mainly because of anxiety and a desire to understand their own potential for denials, says Brocato. Over time—and as Recovery Auditor targets and denial ­patterns have become more apparent—fewer ­hospitals seem to undertake the task. Some hospitals choose to perform self-audits only when Recovery Auditors ­announce new issues or targets, she says.
“I think most hospitals are trying to at least audit a certain percentage whereas I think they used to try and audit 100%,” says Brocato. Hospitals should self-audit at least 10% of the records requested before sending them to the Recovery Auditor so that they can keep a constant barometer on their performance, she says.
Providence Health & Services
Providence Health & Services, a large hospital system that spans Alaska, California, Montana, Oregon, and Washington, initially performed self-audits of all records before sending them to a Recovery Auditor. ­However, when the Recovery Auditors started doubling their requests, staff members couldn’t maintain the pace.
With the increase in the number of records ­requested, we have centered our resources around satisfying the medical record requests and reviewing and responding to denials,” says Laura Legg, RHIT, CCS, revenue control coding consultant at Providence Health & Services.
Legg spends approximately 80% of her time ­reviewing and appealing coding-related RAC denials for eight of the health system’s 27 hospitals. She spends the remaining 20% of her time reviewing and appealing denials from other auditors, performing internal audits, and educating coders about audit results. “The information has to be passed on to the people who are actually doing the work,” she says.
Recovery Auditor denials, in particular, have ­become more complex and time-consuming to process as the program has evolved, says Legg. “RACs are getting smarter. At first, it was sepsis, excisional debridement, and other things that we’ve known to be problems for a very long time,” she says. “Now, they’re starting to deny additional diagnoses for clinical validation. I’ve also seen more principal diagnosis changes.”
Performing self-audits prior to sending records to a Recovery Auditor has value, but many hospitals, like Providence Health & Services, must instead focus on reviewing actual denials, says Legg.
Phelps County Regional Medical Center
Phelps County Regional Medical Center, a 240-bed rural facility in Rolla, Mo., has a different approach.
Cathie Eikermann, MSN, RN, CNL, CHC, ­interim compliance and privacy officer and RAC manager, currently reviews records before sending them to a ­Recovery Auditor. When the Recovery Audit program began, the hospital received 50-70 requests every 48 days, and Eikermann spent most of her time performing self-­audits. The job was demanding, yet manageable. However, when the requests spiked to 200, Eikermann, a full-time ­employee, could no longer review every record herself. “Our physician reviewer is still looking at each one, fortunately,” she says. The physician reviewer helps identify records at risk for potential denial based on lack of documentation or lack of substantiating clinical ­evidence, she says.
Eikermann’s own process for reviewing records is highly organized and efficient. During her 10- or 15-minute review of each record, she performs these tasks:
  •  Review the record to ensure that it includes all items on a checklist that she developed. Giving reviewers the big picture is important, she says. Providing all necessary information up front so that reviewers don't deny a claim due to an apparent lack of supporting documentation, particularly when the documentation exists but simply wasn't sent, is more cost-effective.
  •  Identify any documents that may be missing from the record.
  • Remove non-pertinent information (e.g., duplicate copies, insurance information, and hospital-specific forms such as room changes or home medication lists) from the record.
  • Assess the potential risk for a medical necessity ­denial. This includes validating admission orders as well as reviewing ED documentation, the physician's history and physical exam, and any other information available at the time of admission to determine whether the correct admission status was assigned.
  •  Determine whether documentation is present to support an appeal if the record is denied. This includes preliminary research of updated evidence-based practice standards that can be used during the appeal process.
Questions to consider
When deciding whether to perform a self-audit before submitting records, consider the following questions:
How many Recovery Auditor requests does your hospital receive? In reviewing this number, hospitals must consider whether reviewing all or a portion of the requests is realistic, says Legg. “The number of requests a facility receives really determines the administrative burden placed on the facility,” she says.
Hospitals with a larger volume of requests may find it difficult—or virtually impossible—to review records beforehand, says Brocato.
Are staff members available to complete a self-audit? Ideally, a coding professional with a strong clinical background, a CDI specialist, and a physician should all participate in the self-audit, says Legg. Each must have a clear understanding of how data gleaned from Recovery Auditor requests, reviews, and denials can provide crucial information for future process improvement.
Do you have a defined process for performing self-audits? Hospitals have 45 days to respond to Recovery Auditor requests, which is why it’s paramount to develop an efficient self-audit process prior to sending the record, says Brocato. “It’s a very time-consuming process. It’s basically like re-coding that record again,” she says.
How will staff members report errors discovered during a self-audit? Each facility must determine what will trigger self-disclosure to CMS, says Brocato.
“We do self-report, sending in the overpayment and re-billing if within the timely filing period,” says Eikermann.
Note that isolated errors don't necessarily require self-disclosure to CMS. However, if self-audits reveal a larger pattern or trend of errors, hospitals should consult with legal counsel to determine whether disclosure is necessary.
For more information, access Transmittal 425, ­published June 15. CMS also has proposed revisions to its Provider Self-Disclosure ­Protocol, which establishes a process for providers to disclose potential fraud as well as investigate and report fraud. The current protocol was first published in 1998. Proposed ­revisions were published in the June 18 Federal Register.
“If you do find something that could be considered fraudulent, you’re obligated to self-disclose that,” says Brocato. “So if you’re going to self-audit, you’d better have a plan in place for how you’re going to handle [any errors that you find].” This plan should also include how you'll provide education for those who need it, she says.
Editor’s note: This article was originally published in the September issue of Briefings on Coding Compliance Strategies. Email your questions to Senior Managing Editor Michelle A. Leppert, CPC, at

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