Payers Use Savvy Audit Tactics Against Physicians
In early 2017, Dr S, a California physician, received requests from Anthem Blue Cross for eight patients' medical records. Dr S delegated the task of responding to her office manager, who never sent the records. Two months later, Anthem placed Dr S's claims on prepayment review.
Being put on prepayment review had a huge impact on the practice. Despite sending in—sometimes repeatedly—voluminous records, Anthem continually denied payment. Sometimes it said it never got the records; other times there was some other rationale for nonpayment. Each denial cost time—a lot of time.
And Dr S had to appeal thousands of claims. Anthem scrutinized the medical records during prepayment review and refused to release the claims until more than 1 year later. A timely and thorough response to the initial request may have avoided everything—but on the other hand, if the response had been done poorly, it could've made things even worse.
On a different occasion, Dr G, another California physician, rebuffed UnitedHealthcare's requests for medical records. In response, UnitedHealthcare reported Dr G to the state medical board for billing fraud, saying he failed to document the services for which he billed them. Dr G ultimately resolved the matter, but the licensing board investigation was stressful and exposed him to license discipline—including loss of licensure.
California physician Dr H received and paid several insurance demands for repayment before seeking counsel to defend the insurance audits. Dr H learned that simply paying an overpayment demand does not necessarily stop an insurer from seeking funds from other repayments. In Dr H's case, it seems that every time he paid without challenge, a new and higher demand for something else was sent.
Insurance audits are on the rise. And insurers are becoming more strategic and savvy in reviewing medical records and billing.
The Centers for Medicare & Medicaid Services (CMS) reported almost $32 billion in net accounts receivable from the public for the fiscal year (FY). The amount included provider and beneficiary overpayments, Medicare prescription drug overpayments, Medicare premiums, state phased-down contributions, Medicaid/CHIP overpayments, audit disallowances, civil monetary penalties and restitutions, the recognition of Medicare secondary payer accounts receivable, and exchange activities. CMS's FY2017 net accounts receivables marked a nearly 33% increase over the previous fiscal year.
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Cite this: Keith W. Carlson, Kathy W. Nichols. How an 'Innocent' Audit Can Spell Big Danger - Medscape - Mar 19, 2019.