Facing insurance audits as an out-of-network provider
4/12/2022
Still have no contracts with some insurance payers? While out-of-network payment rates may be attractive, insurances are still quite “peaky” when it comes to quality assurance. However, having no enrollment contact does not mean facing no recoupments.
According to internal research done by our billing experts in December last year, many of our clients had submitted claims to at least five payers where they had been out-of-network. Having no enrollment contract relieves healthcare providers from tons of paperwork related to credentialing maintenance. However, such benefits obviously come with a price.
In 2021, we saw increasing auditing of medical records for in-network providers. Payers throughout the country have launched countless payment integrity programs to ensure that only medically necessary services are getting paid. Healthcare providers had to submit hundreds of pages of charts only to find out that the money had been recouped nevertheless.
We have noticed that non-participating providers are getting audited more often as well. Even if you are not in-network with some insurance carriers, you will still receive many requests for medical records from them. Ignoring insurance audits and any other requests in general is never a good idea. Our private practice insurance audit checklist will help you deal with such requests quickly and efficiently.
I. Understand the purpose of the audit
Medical insurance companies usually check specific claims on behalf of their Risk Adjustment Audit programs. They may want to conduct a review for medical necessity or proper coding of your services. Such requests are routine, and there is nothing to worry about, provided that your records are in good order.
On the contrary, an inquiry related to issues of fraud, waste, and abuse is often signaled by an audit letter from the company’s Special Investigations Unit (SIU). Healthcare providers suspected in fraudulent treatment, billing, and coding practices may receive such a request regardless of their participation status.
II. Check the validity of the request
As surprising as it sounds, insurance carriers often confuse one healthcare provider with another when issuing an audit notification. Based on our experience, this is especially common among out-of-network providers. Imagine a situation: you receive a request for medical records for patients you have never seen and services you have never provided. While this is quite an extreme example, it is not uncommon for payers to request invalid or non-existing information from non-contracted providers. As a result, once you get a letter from insurance asking you to provide some information, please check it carefully and make sure that the requested information is related to your practice. Should you notice a discrepancy – contact an insurance payer immediately to initiate a cancellation or a reissue of the request.
III. Understand the payer’s record-keeping requirements
Understanding the policies of the patient’s benefit plan as the company/auditor may determine medical necessity through the lens of the insurer’s documentation standards. There is no universal list of insurance audit questions, but payers typically ask for documentation to support medical necessity, such as patient name and date of birth; dates of service; start and stop times for face-to-face interaction; diagnosis, symptoms, and status; treatment plan, goals, and achievements. You can easily access policies through the insurance company’s website. Under HIPAA, insurance companies are only entitled to the minimum necessary information to support the reason for the audit. You may also want to adjust your record-keeping practice in anticipation of a future request.
IV. Check the deadlines and ways of submission
Medical claim audit notifications and all other requests for additional information always have instructions on how and when to submit the documentation. In case of an audit, we recommend that you provide the requested documentation online or by regular mail if any of these is applicable. Should you decide to send a hard copy to the payer – please make sure to comply with the deadlines. While you may submit the documentation shortly before the deadline, it may still arrive late due to frequent delays in delivery by the USPS. Our experience shows that is better not to use fax because sometimes it does not deliver the documentation in full, making some pages disappear from the package. Such inconsistencies are unacceptable.
In addition, as an out-of-network provider, you may be asked to include your W-9 and license into the package. This is a standard procedure, so please feel free to attach this additional documentation.
V. Follow up on your submission
It is especially important to ensure that the requested documentation reaches its destination when you are out of network with the plan. Moreover, you should always check if the documentation has been attached to your audit case. As we mentioned before, mistakes are not uncommon. Please contact the insurance two weeks after the submission date to get a confirmation receipt.
When it comes to being all-set for potential insurance audits, your participation status is irrelevant. Regardless of whether you are active with insurance or not, there is only one way to prepare your practice for an audit: keeping your charts in good order. Your clinical documentation should be as detailed as possible. It should reflect the most accurate information on a patient’s clinical condition and the services that you render. Any discrepancy or inconsistency may lead to costly recoupment or even civil/criminal liability. We recommend that you routinely look through your documentation and eliminate all the inconsistencies that you encounter.
Where there is a problem, there is always a solution
Did you know that you no longer have to check the charts on your own? WCH Service Bureau provides a unique internal auditing service that keeps recoupments at bay. With over two decades of experience, our specialists can identify all the inconsistencies in your documentation with the utmost level of precision.
Interested? Contact us!
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