Posted and filed under FWA, Medical Record Auditing.

Commercial Health Plans

The act of tailoring medical record audit procedures to the needs of a particular health plan is not a novel concept. Different commercial healthcare payers maintain requirements unique to their served populations, and audits are consistently slightly augmented in order to focus on E/M, specific and proper modifier usage, and other various criteria.

With commercial audits, no matter the variances in specificity, there are core concepts that remain static. Four core principles will almost always remain unchanged for commercial health plans:

  • Perception of Providers
    • The very existence of any commercial health plan relies on the clinicians and providers who accept patients with their particular insurance plans. Without a network of providers, the health plan would flounder.
  • Reasons for Auditing
    • The intention of a commercial health plan review is typically to promote provider education. Through the education and enlightenment of providers, commercial plans hope to improve the flow of funds and maintain member protection.
  • Audit Results
    • Fraud, waste, and abuse (FWA) are often detected in commercial health plan reviews, though the exposure of such discrepancies does not often reach full awareness potential. The value of FWA identification is often lost due to the scope of work and audit limitations.
  • Fund Recovery
    • Recovery audits for commercial health plans do result in the collection of funds, but recovery sums are typically average in scale.

Due to commercial plans’ reliance on providers, they are able to hide behind “educational audits”, where providers only face minor penalties for violations. This allows them to cater to their providers, while still making an effort to protect their members and funds. Their unique perception of providers influences the selection process, and where the audits are targeted.

Commercial health plans tend to base audits on trend billing patterns. High level Evaluation and Management (E/M) codes, overutilization, and outliers, or data reported by peers or other plans within a similar region are all common focal points of commercial audits.

Federal Health Plans (CMS)

The necessity of adaptation is best demonstrated when medical record auditors accustomed to the uniform nature of commercial health plans are faced with a federal health plan review. Where they had previously experienced minor changes between commercial plans, federal health plan reviews present not only differences in audit requirements – but in core principles as well.

  • Perception of Providers
    • Providers are typically seen as a method of patient care delivery. They are a necessary actor in the health care process.
  • Reasons for Auditing
    • Audits performed in the federal health care sector are performed to protect funds and beneficiaries.
  • Audit Results
    • The identification of FWA is a result of both commercial and federal reviews. When FWA is detected in a federal health plan review, violators of policy and law are faced with consequences and penalties with high severity.
  • Fund Recovery
    • Federal audits often yield extremely high sums of recovered funds. In fact, Advize Health performed a federal health plan review that resulted in and $976,014.00 Had this same audit been performed for a commercial health plan, the recovery would have only been $3,274.65.

Federal (CMS) audits do not rely on provider participation, as they are equipped with an endless pool of providers and patients. Federal audits focus on potentially high-dollar recoveries and strive to maintain Program Integrity. The loss or exclusion of a participating provider serves to protect Program Integrity, which prevents CMS from spending millions of dollars on FWA. This stance on provider participation and recovery goals means that the selection process for federal audits is also different than that of commercial health plans.

CMS selects a provider or practice for an investigation based off of data mining, filed complaints, referrals, and reports. Referrals used to determine audit participation are often coming from CMS contractors, including RACs, ZPICs, and MICs. Complaints can come from any source associated with the practice or institution, including physicians, employees, and other Whistle Blowers.

An auditor’s ability to recognize the individual needs of commercial and government health plans can only serve to create a more robust community of compliance professionals. It is important to approach audits with intention and criteria in mind in order to reach the full potential of audit results and resolution.