Blog Post
We continue our Year-End Series with a brief discussion of an often overlooked but important housekeeping tool: audits. The word “audit” makes healthcare leaders, providers, and managers cringe. Depending on the role you play, you immediately thought of one of two sets of letters: IRS or CMS.
While tax audit or a recovery audit actions are stressful (and extreme) situations, the idea of an audit should really be providing you peace of mind. Self-audits of charts, billing, HIPAA and HITECH, and financials should be part of your normal practice patterns. Periodic external audits are helpful, too, in ensuring your financial statements are accurate and complete.
As you close out 2020 and refine your plan for 2021 growth, consider establishing a set schedule for reviewing key areas and incorporating specific audits into the plan. The benefits of audits boil down to a method for discovering a possible issue before it becomes a real problem. This is true for compliance (think HIPAA / HITECH), tax implications (IRS), as well as fixing revenue leakage (RCM). Use audits on your terms so you can get the greatest benefit.
Each set of audits has its own benefits; the advantages of regular financial scrutiny include:
Ensuring accuracy. When the IRS comes poking around, they are looking for errors and not necessarily more taxes to collect. Self-auditing the numbers identifies inaccuracies before and documents corrective actions to show stakeholders (owners, investors, partners, taxmen) your books are correct and you are compliant.
Optimizing processes. A self-audit may reveal opportunities to streamline processes or identify service areas to commit additional resources based on returns as well as areas to reduce errors. Accuracy is a measure of efficiency and metrics. Looking at the numbers can help improve productivity.
Catching external errors. Taking a closer look at numbers in and out can identify issues earlier. Errors in payments and billing occur frequently in healthcare. Depending on the systems used, errors may not be seen clearly without auditing the data. This applies to transactions with clients and vendors as well as audits within your revenue cycle management process for claims.
Maintaining compliance. Within your audit plan, be sure to review your data from the perspective of compliance. Make sure you have your business associate agreements (BAA) and similar documentation up to date, too.
Empowering the team. As part of your controls, it helps to identify employees or teams with service lines. Employees gain a better idea of where they fit in the process. This helps overcome hesitancy to speak up about issues they identify.
Make auditing a priority for 2021; use the effort among tools to unlock increased productivity, sharper compliance, and a better overall clinic.
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