Payor Auditing Activities

By: Kelli Carpenter Fleming

During the height of the COVID-19 pandemic, the Centers for Medicare & Medicaid Services (“CMS”) suspended certain payor audit and oversight activities. However, now that communities are beginning to reopen, so are the audit activities. CMS and other third-party payors are increasing their audit activities, including claims filed during the public health emergency. 

Providers who are the subject of a billing audit must take such investigations seriously. Providers should identify one person in the organization to handle audit responses, calendar deadlines, and track findings and appeals. This avoids missing a deadline and helps ensure effective use of personnel resources. 

Providers should respond to any records request in connection with an audit in a timely manner, which may be more burdensome these days due to staffing shortages. The failure to timely provide requested records will, in most instances, automatically result in the denial of the claims. Providers should retain a copy of any records and information submitted in response to the document request, and, if sending by mail, obtain confirmation of delivery. 

In responding to any records request, it is wise to conduct an “internal self-audit” to determine if there are any areas of risk. This not only helps determine if there is a repayment obligation to the payor, but also helps gather information and arguments for appeal if necessary.

Lastly, depending on the scope of the audit or the type of the audit, providers may want to consider putting both their insurance carrier and their legal counsel on notice of the audit. There are some steps that can be taken upfront, as well as some traps to avoid, in connection with the audit response process, and the insurance carrier and legal counsel may be able to assist in that regard.

Kelli Fleming is a partner at Burr & Forman LLP and works exclusively in the Healthcare Industry Group. Kelli may be reached at 205-458-5429 or kfleming@burr.com.