Best practices for approaching payer audits

November 3, 2016

As we continue to see an increasing number of payer audits in the pathology world, we wanted to take the time to walk you through some best practices and helpful tips for navigating these audits and protecting your revenue.

It’s important to note that these audits will not be limited strictly to Medicare. Many managed care organizations have identified this as potential cost savings and now have their own internal audit teams or have hired third party auditors to validate your charges. Sometimes, these requests may not be directly addressed as an audit and may instead come in another form. It is imperative that you or your biller are on the lookout for these types of communication (or denials).

Some auditors are finding 100% error rates – and may go back years to reprocess and take back payments already made to you. You must be vigilant in understanding your contract and the payer’s limitations on takebacks. We’ve seen clients successfully win money back because, under their contract, the payer could only recoup back “x” number of months or years.

Unfortunately, many billers are still appealing these incorrectly because they are not communicating these denials and getting the coding department or doctors involved to write these appeals!

Several of our groups that bill stains are having issues with limitations of units, medical necessity denials and back end audits.  The billers are often not staffed well enough to have a successful appeal process, which many of these carriers are banking on to begin with!

These payers are looking for signed requisitions for IHC/special stains/molecular orders and/or documentation of medical necessity.

Action steps for appeals:

  • Include in the pathology report the trigger words:  “ X was ordered because…”. The auditors are most likely not pathologists, they usually just look for trigger words.
  • When an audit request is received, it’s not enough to just send the final reports. Also, include an additional signed attestation by the pathologists that they ordered such and such stains/flow/ihc/molecular.
  • Include a copy of relevant medical chart notes that makes it clear why the pathology specimen was ordered in the first place, i.e. surgeon’s note saying a colectomy was indicated due to presence of cancer or obstruction.


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