6 Steps for a Successful Audit

Posted on 22 Dec, 2017 |comments_icon 2|By Elizabeth

Auditing medical records can be a confusing and time-consuming endeavor, but it doesn’t have to be.  If you’re contemplating performing your first self-audit, it’s natural to feel intimidated. Your efforts, though, will pay in big dividends, which is why we’d like to help allay your fears with a simple six-step plan.

Step #1

Step one of the audit process involves the audit scope. You need to know what will, and what will not, be included in the audit. There may be a specific service that needs auditing, like new office visits, consultations, inpatient visits, or certain diagnosis codes.

The scope should also target the date range that will be included. The range may include a quarter, a year, or another time frame that has been determined. The payer may also be taken into consideration. There could be a need to review charts that have been billed to Medicare, Medicaid, Aetna, or another specific payer.

Step #2

Identifying the sample is the second step of the audit process. In step two, you will determine the sample size. The standard sample size is usually between 10 to 15 cases per provider. OIG recommends a range of five to ten charts should be audited per provider for annual audits. However, trends can be better identified with a sample size of at least 10 cases.

If you are auditing both surgical and E/M charts, a sample of 10 from each would be ideal. You can select every fifth or sixth chart from a patient list until you reach the appropriate sample size. Pulling from the scope, you will include what will be audited within that sample size. In most cases, a patient list or report is generated to allow the auditor to select their cases to audit. Once again, this can be a focused or random selection of cases.

Step #3

Step three of the audit process will be determining the resources and audit tools that will be used during the audit. The resources you need will depend on the type of audit that is being performed, and the services that are under audit. Having access to resources like the ones discussed further on in the book will make or break your audit success.

Step #4

Step four of the auditing process involves locating the documentation needed to conduct the audit. Once the sample size and charts being audited have been identified, you will need to collect documentation. Electronic medical records are a great source of documentation, as most practices have migrated from paper charts. There are still some practices that use a combination of paper and electronic records, and occasionally you will find a practice that uses only paper charts.

Make sure that you collect the documentation that pertains to the date of service for the chart that is under review. You may not only have a note, but also forms, images, and other miscellaneous items; to successfully conduct the review, all pertinent documentation is needed.

Step #5

Step five of the audit process is conducting the audit. Utilizing the tools and resources at your disposal, perform the audit. Be sure to audit both the coding and the documentation. Pay attention to the guidelines in the CPT®, ICD-10-CM, and HCPCS Level II manuals, in addition to ensuring documentation compliance.

Step #6

Once the audit is complete, analyze your findings and compile them into a report. It is essential that you understand how to compile the results of the audit into one single report. Developing a concise and informative audit report is critical. Ensure that your report is clear yet detailed enough to get all the information across to your client. Note any trends and errors in documentation. The audit will not provide results unless there is a subsequent effort to correct the identified problems.

Audit reports should contain:

  1. Key findings
  2. Rationale behind the findings
  3. Recommendations for correction and education

You should always allow coders and physicians the opportunity to review the results of their coding audits, and the chance to openly discuss the findings. Avoid writing overly negative feedback in the audit report. If your reporting and communication is too harsh, it will not benefit the practice, and can ultimately lead to defensive reactions that may be more damaging than inaccurate coding.

Be sure to follow through with your recommendations, suggestions for future reviews, and tips on educating physicians and staff.

Example: Always notate when a physician is not documenting a thorough history or chief complaint. Explain to the physician why capturing these elements is important for the patient, the practice, and for reimbursement purposes. Finally, ensure you suggest these as target areas for future audits.

Strategy: If you can show improvement from one quarter to the next, that is a good sign of your organization’s commitment to compliance. Addressing issues upfront will minimize the likelihood that you will have to pay money back to Medicare or another payer when audited.

Follow this audit report format for success:

  1. Background – details the entity, the provider being audited, the audit scope, the type of audit, and the auditor’s identity
  2. Findings – details should be highlighted by error. Ensure that each mistake is addressed in a manner that will outline the risk to the provider. The report should also be detailed enough to discuss where and how each error occurred.
  3. Criteria Used – provides evidence of the regulatory basis behind the code reviewed.
  4. Summary – details the findings and will provide information pertaining to any common errors found during the audit. A recommendation for improvement may include education suggestions or an increased audit frequency.
  5. Resources – Attach any resources to support the audit findings. This will help provide additional information to the provider.

Learn More

Still feel nervous or insufficiently prepared? Let us help.

Pick up your copy of TCI’s Master Auditing Basics. This invaluable resource lays out in-depth guidance for effective review of medical documentation. The experts at TCI show you how to conduct internal and external reviews of coding accuracy, policies, and procedures to ensure you’re running an efficient and liability-free practice.



Elizabeth works on an array of projects at TCI, researching and writing about modern reimbursement challenges. Since joining TCI in 2017, she has also covered the nuts and bolts of cybersecurity, compliance with federal laws, and how to tap into the advantages of telehealth services.

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