You typically don’t have compliance issues due to one clear billing error, if it comes to mental health practices. Risk accumulates over time, via disjointed workflows, inadequate documentation, aging payer rules, lack of enrollment, poor payment controls, and repeated exceptions that become commonplace.
It is possible for a therapist to record the appropriate clinical service without including all information required for a time-based code. The provider’s group affiliation may be activated prior to a psychiatrist beginning treatment for a patient. An authorization can be acquired but isn’t linked to the scheduling and claim-submission process. No one may be tasked with checking credit balances, so it may be posted as ordinary revenue, instead of a “payer overpayment.
These events can be administrative in nature, at first glance. All of these failures, taken together, can cause claim denials, recoupments, refunds, audits from payers, network conflicts, and inaccurate financial reporting.
The professional mental health practice audit services help eliminate the issue by checking the consistency of clinical records, claims, payer approvals, provider data and financial transactions. Its intention isn’t simply to uncover inaccurate statements after you receive your payment. A good audit will find the ways in which errors can be repeated and make them better.
Compliance Risk Begins Before a Claim Is Created
A number of practices see compliance as synonymous with coding. While correct coding is essential, there is a lot more that needs to be done before a claim is coded to be compliant.
The process starts with patient registration, insurance check, provider eligibility, network status, authorization requirements, and benefit limitations. At this point, if there is a mistake in the information that passes through the revenue cycle, it can make a technically correct claim nonpayable and/or confusing.
When a patient’s behavioral health benefits are provided from a different plan than the medical benefits listed on the insurance card, consider that. When the practice submits only basic medical coverage, it could schedule services with an out-of-network provider, fail to check if there is an authorization needed, or submit the claim to the wrong payer. By the time the denial makes its way to the billing department, the compliance issue may have already impacted patient scheduling, patient liability and reimbursement.
An effective RCM audit for mental health services, then, does not audit coding per se but looks at the entire financial journey. It questions whether the practice had the necessary information, approval and provider status to bill the service prior to treatment.
A Compliance Audit Must Reconcile the Record With the Claim
The main issue in a behavioral health audit is simple: is the practice able to demonstrate that the claim is a true reflection of its services?
A professional billing audit involves a review of claims against the progress note, treatment plan, provider credentials, authorization record, appointment information, and payer adjudication. These records should be consistent with this story.
Where a psychotherapy claim is based on a time-based service, the documentation should substantiate the time period. When psychotherapy is performed as part of a psychiatric evaluation and management, the record should separate the psychotherapy from the evaluation and management of the medical condition. If the psychological and/or neuropsychological testing is billed, the file should document the type of testing activity, the professional who provided the services, the time billed, and the clinical purpose of the test.
A fault is not necessarily an indication that care was wrongly given. It does not mean however that such practice will not be able to defend the claim in an external review. Internal auditing provides an opportunity for the organization to correct the process before an invitation to provide records to a payer or asking for repayment.
Documentation Must Establish More Than Attendance
It is not always enough to have a signed note stating that the patient went to an appointment to receive reimbursement.
The documentation for behavioral health should include justification for clinical appropriateness, services provided, patient responses and the relevance to treatment planning. All treatment should not be supported by repetitive language that does not demonstrate the patient’s condition, progress and continuing needs.
It is often a feature of auditing to ask whether the diagnosis, presenting symptoms, treatment objectives, interventions and the frequency of services is a clinically coherent record. They also search for late signatures, duplicated language, discrepancies in time stamps, unsupported service intensity changes, and notes that don’t relate to the billed service.
The goal is not to mandate same documentation for all clinicians. Mental health records need to be both clinically relevant and individualized. The audit checks if the organisation’s documentation practices are consistent with medical necessity and billing status of services billed.
If the same weakness is shared by multiple clinicians, then it is unlikely that a note-by-note correction approach will solve the issue. The practice will need to change templates, update documentation policies and deliver targeted clinical education.
An audit reveals Provider Enrollment and Affiliation Errors
One of the overlooked areas of behavioral health billing risk is provider enrollment.
A clinician can be actively licensed and not be eligible to receive payment from a specific payer. The provider can be separately credentialed, but not related to the practice tax identification number. A service location might not be operational. The clinician might have been approved by the payer in one group while the claims are being submitted to another group.
These do not require basic claim formatting. Will NOT solve them if resubmitted again.
The organization can use mental health practice audit services to audit its provider list against provider enrollments by payers, effective dates, network status, approved locations, taxonomy information, group affiliations, and more. Providers that have exited the organization but continue to appear in the provider directory or billing system should also be included in the review.
This reconciliation is especially valuable when you’ve undergone an acquisition, a change in ownership, a quick hiring spree, opened up new offices, or switched billing companies. If not, the practice might be filing claims based on current or incomplete provider relationships.
Authorization Controls Must Connect Clinical and Financial Workflows
Often, prior authorizations fail even though a prior authorization was obtained.
It could be a scanned document which the biller is not able to access. Staff might not be aware of the number of visits left. Payer can authorize one service and provider provides another. An extension request can be made, but more appointments may be set up prior to approval.
An audit checks the reliability of the entire authorization control. It checks to see if approved services, units, providers, locations, effective dates, and expiration dates are entered into a format that is usable for scheduling, clinical, and billing teams.
The auditor should also identify what will occur if the information pertaining to authorization is missing or ambiguous. If relying on staff memory or on informal messages, the process is open to failure. A defensible system will either be able to block or alert appointments and claims made outside of approved parameters.
An audit is how an audit helps ensure compliance without simply catching the unauthorized service after it has occurred; it will go to the root of the problem: why was it possible for the practice to provide and invoice for an unauthorized service?
Data Analysis finds patterns that Individual Claim Reviews miss
Random claim sampling is good but not enough for a mature audit program. Compliance risk can manifest in a trend for providers, codes, locations or payers.
An RCM audit of mental health practices using data can reveal trends in coding distribution, the frequent use of the same modifier, a sudden surge in a specific service, clustering of denials, manual adjustments, or variation between clinicians and practices for delivery of the same service.
Such patterns are not necessarily a sign of wrongful billing. They pinpoint issues that require further investigation.
For instance, a provider could report significantly longer or more intensive services than a provider with an equivalent number of patients. This difference might be due to proper or improper charge configuration, documentation habit and/or clinically acceptable. Data analysis indicates the auditor what to investigate, while a record review indicates if the pattern is supported or not.
This will enable the practice to concentrate audit efforts on actual risk, rather than having to audit a high volume of claims with little regard for the risk.
Payment Integrity Is a Compliance Function
Ongoing compliance obligation remains once the claim has been processed by the payer.
The potential of financial exposure can arise from incorrect contractual adjustment, duplicate payments, credit balances, unapplied funds, unsupported write-offs, and unsolved overpayments. A billing system can also close a claim that hasn’t been paid at the contract rate or the balance is incorrectly applied.
During a comprehensive behavioral health billing audit, the explanation of benefits or electronic remittance, the posted payment, adjustment reason, patient responsibility, and expected reimbursement will be reviewed.
The review should identify why balances are reduced or removed, and if this is the case, ensure that staff can explain this. It is not acceptable to post a large write-off without documentation and approval. There is no mechanism for following up credit balances, so they should not be kept forever.
Payment-integrity auditing also provides for the protection of underpayments in the practice. Compliance does not only mean avoiding over-reimbursement, it means keeping accurate financial records and properly managing payers’ contracts.
Compliance Intelligence is not a Collection Problem – Denials Are!
Many practices see denials as individual claims to be corrected and resent. This can return some revenue, but it doesn’t tackle the process that created the denial.
Denial for missing authorization could be an authorization scheduling control failure. If an enrollment is denied by the provider, it could signal that the provider’s credentialing list isn’t current with the provider’s billing system. If a medical necessity denial occurs, this could be related to documentation that didn’t meet the criteria or a payer policy was misconfigured.
An effective audit will classify denials based on the root cause, not just what is on the remittance. Then it follows each category back to the relevant workflow.
When denial data is applied in this manner, it is a warning system. An unexpected increase in one denial category can indicate a payer change, system configuration issue, training gap, or enrollment issue, before a significant number of claims are impacted.
Auditing Third Party Billing & Technology Vendors
Bill outsourcing is not a way to abdicate the practice’s compliance obligation.
A mental health organization should be familiar with the way its billing company bills, updates codes, applies adjustments, processes denials, communicates with payers and maintains access to patient information. This also extends to electronic health record platforms, payment-processing systems, credentialing vendors, and clearinghouses.
Professional mental health practice audit services could be used to determine if vendor activity is consistent with the policy and contracts in the practice. Access rights, adjustment authority, claim-edit logic, escalation logic, reporting transparency and who has the responsibility to correct system errors should be assessed during the audit.
A vendor can create a beautiful collection report — even if they’re using undocumented workarounds or not cleaning up old balances. Leadership may not be aware of the compliance risk when viewing the financial result without the benefit of an independent review.
Corrective Action Should Change the System
An audit report that simply contains mistakes is of little value.
Each key discovery must be converted to a corrective action which will handle the root cause. Documenting better is not enough, if healthcare workers continue to skip the required time data. The practice might need to redesign their note template, establish standards for note completion, train providers, and then have a follow-up sample of the notes.
Steps may need to be taken to ensure that a system hold is in place with verified effective dates if claims are released prior to the payer enrollment becoming active. If employees can post big changes without any review, the approval levels and audit logs may need to be created.
The recovery plan should include who is responsible, a timeline for completion, and a definition of success. This should then be followed up with targeted testing to verify implementation by management.
An important distinction is this: claim correction will address one account, control improvement will address the next hundred accounts that are about to have a problem.
Auditing Should Be Continuous and Risk-Based
A yearly review might not be sufficient for a developing behavioural health organisation.
Risk profile of the practice shifts with new providers, payer contracts, telehealth models, service locations, billing systems, and clinical programs. Audit priorities must change with those changes.
A good compliance program incorporates comprehensive checks at regular intervals with targeted monitoring that looks at actual billing information. Some documentation quality, authorization failures, provider enrollment, payment adjustments, denial trends and credit balances may be tested at varying frequencies based on exposure.
The point is to not audit everything all the time. To focus control over those aspects of an organization’s activities which have the greatest potential for causing tangible material effects or compliance-related issues.
Frequently Asked Questions
What is the audit of mental health practice services of?
They might be able to examine clinical documentation, coding, enrolment with payers, authorizations, claim submission, claim denials, payment posting, contractual adjustments, credit balances, vendor activity, and financial controls within the system.
What is the benefit of a billing audit for behavioral health to avoid compliance issues?
It is a comparison of claims and the clinical and administrative data used to support the claims. This will detect weaknesses in unsupported coding, inconsistent documentation, provider information, and more before they impact a larger claim population.
What is the difference between billing audit and RCM audit?
The typical focus of a billing audit is on the accuracy of claims and documentation. An RCM audit for mental health practices reviews the entire financial journey from registration, eligibility, authorization, credentialing, billing, payments, denials, adjustments and account resolution.
Will an internal audit shield a practice from recoupments from payers?
An internal audit can not eliminate all risk from the payers, but it can detect unsupported claims, overpayments, duplicate payments and recurring billing errors in time to investigate and take proper corrective measures by the practice.
When is it time for a mental health practice audit?
Auditing is especially crucial when growth is rapid, services or locations have been added, there has been a shift in billing vendors, denial rates are increasing, payment trends are also changing, payers have requested records, or there has been a large fluctuation in providers. Regular check must be kept on even in absence of any apparent issue.
Conclusion
Audits can help identify any discrepancies between a practice’s policies and actual daily procedures, thereby avoiding any compliance problems.
A comprehensive behavioral health billing audit establishes if claims are supported, accurate, and defensible. An in-depth RCM review for mental health extends beyond the claims themselves, and covers the entire RCM process, including patient registration, provider enrollment, payment posting and final account decisioning.
The best mental health practice audit services do not inundate leadership with a checklist with general information. They are able to detect material risk, understand its financial and compliance implications, determine its cause and implement controls to prevent recurrence.
On the other hand, for a mental health practice, it’s not just a defensive maneuver. It’s a component of good clinical management, dependable revenue management, and future management of the organization.
