Put PFS on the path to success with collaborative audits

Audits are a check-up for revenue integrity. Auditors ensure processes are running correctly, revenue cycle steps are compliant, and, if a process is non-compliant, they prescribe a plan of treatment. Skipping a regular audit, like skipping an annual exam, can lead to larger, more costly problems down the line. And a lack of proper auditing and remediation in one department can easily spread problems to related departments.

Patient financial services (PFS) is a key department for revenue integrity and is often tasked with multiple highly complex duties that are closely controlled by payer regulations. Assisting that department with understanding the Medicare and Medicaid rules is one of the responsibilities of Nadia Duncan, CRCS-I, CPC, CPMA, senior compliance auditor, corporate compliance, with Atrium Health in Charlotte, North Carolina. She works with PFS on various compliance related audits and issues that PFS leadership identifies and brings to the attention of compliance. She also works with the PFS department to deliver monthly education on key compliance topics which include internal audit findings, Office of Inspector General (OIG) and CMS activity, and information from their MAC, Palmetto GBA.

Atrium Health’s compliance department worked closely with PFS to develop a compliance audit workplan which has been in place for several years now, Duncan says. To create the audit workplan, compliance and PFS leaders looked at internal data, OIG reports, Palmetto GBA publications and determined the risk areas that require attention. One risk area that it likely common to most hospitals is compliance with the Medicare Secondary Payer guidelines, she adds. Other common PFS audit topics include compliance with the diagnosis-related group payment window regulations and credit balances. “CMS and Palmetto pay very close attention to credit balances, which always seem to be on their radar,” Duncan says. “We’re reviewing credit balances and making sure that we are identifying overpayments and refunding Medicare within 60 days.”

Once the risk areas are identified, the PFS and compliance departments collaborate to create work plan audit questions that will reflect how PFS operates, provide meaningful feedback to PFS, and help PFS accurately identify areas that could be improved. “Some work plan questions are answered on a quarterly basis and others require only once a year review. It assures that our records, our billing, and our processes are compliant,” Duncan says.

Each area of PFS, such as credit processing or medical audit, has a specific workplan audit. PFS audits are completed by the department’s QA team, which consists of PFS internal staff members. They answer the work plan questions and provide objective review, feedback and recommendations. The overall compliance score for each risk area is reported to corporate compliance.

But it’s a mistake to simply trust that, once put in place, a work plan audit will never need a tune-up. One of the projects Duncan worked with PFS on was a work plan validation audit. During this audit, Duncan conducted a second audit of accounts PFS had recently audited. The goal was to see whether Duncan’s audit findings would validate PFS’s results. When she identified areas that PFS believed they were compliant in but she noted there was room for improvement, compliance worked with PFS to open a discussion about the issues identified. “It would bring us to a discussion about possibly updating the work plan, making it better, adding some other questions that needed to be asked,” Duncan says.