Are You at Risk for an Audit?

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One of the most common concerns providers express to me about coding is that they think they will be audited more frequently if their codes are higher. While this may be true if the only codes a provider bills are E&M level 4 (99214) and level 5 codes (99215), however, their audit risk would also be high if all they billed were E&M level 1 (99211) and level 2 codes (99212). The reason there is an increased risk of audit has more to do with code distribution than code level.

When a provider has a normal distribution of billed codes they are less of an outlier than a provider who bills all office visits as 99213s. Let’s consider an example:

If we have 2 providers who are providing care to a similar population and over the course of a year we see utilization of the following codes (we will just look at established 992XX codes):

  • Provider A:

  • 99211 – billed 0 times

  • 99212 – billed 72 times

  • 99213 – billed 0 times

  • 99214 – billed 0 times

  • 99215 – billed 0 times

  • Provider B:

  • 99211 – billed 0 times

  • 99212 – billed 15 times

  • 99213 – billed 42 times

  • 99214 – billed 31 times

  • 99215 – billed 4 times

On general inspection, we can see that the distribution of codes for Provider B appears much broader than Provider A. Payers will also plot these numbers against expected levels of billing (for like providers) and evaluate them for outliers. The scenario looks similar to this for established patient encounters:

When we look at the above graph it is easy to see that even though Provider B bills higher levels much more frequently than does Provider A, Provider A is the outlier when we look at the bell curve distribution of billed codes compared to peers, and Provider A would be the one at greater risk of audit.

We can evaluate new patient 9920X codes the same way, let’s look at another example:

  • Provider A:

  • 99201 – billed 0 times

  • 99202 – billed 11 times

  • 99203 – billed 49 times

  • 99204 – billed 0 times

  • 99205 – billed 0 times

  • Provider B:

  • 99201 – billed 0 times

  • 99202 – billed 0 times

  • 99203 – billed 16 times

  • 99204 – billed 41 times

  • 99205 – billed 3 times

Again, when we look at the above graph it is easy to see that even though Provider B bills higher levels much more frequently than does Provider A, Provider A is the outlier when we look at the bell curve distribution of billed codes compared to peers, and Provider A would be the one at greater risk of audit.

 

The bottom line is:

If you are chronically undercoding because you think that will prevent an audit and your code distribution is highly skewed because of that habit, payers may decide to audit you because of your CODE DISTRIBUTION rather than your CODING LEVEL.

If you want to know more about appropriate coding and billing practices and don't have time or money to spend to travel to a destination, check out our Comprehensive EyeCode: Billing and Coding Course! We provide all the tools and interaction of a live course, that you can complete at your own pace, on your own schedule.

Have a great week! - Chris