6 Reasons To Audit In 2017

Achieving a better night sleep and less work stress could definitely be added as the seventh and eighth reason to audit this year, but we suspect those will come as benefits to addressing the six reasons to audit in 2017.



1. New and revised codes in both coding systems effective Oct 1, 2016 and Jan 1, 2017

Both ICD-10 diagnosis and procedure coding and the CPT system have new updates. We are still seeing a need for improvement for coders with these unfamiliar codes.  Audits are needed to ensure that these codes are being used appropriately. It is vital to identifying incorrect coding and re-correcting it before it becomes an adopted habit by your entire coding team.


2. Return of the RACs (Recovery Audit Contractors)

Under the direction of CMS, RACs have began auditing and there will now be five RACS instead of four. DME, Home Health, and Hospice have been added as targets for the fifth RAC.  Overall payer auditing has increased 936% in the last 10 years.  Everyone is auditing and everyone is being audited!


3. 2016 CMI (case mix index)

ICD-10 coding has changed the CMI. CMI is a number that demonstrates the relative weights of a facility’s DRG submissions for inpatient population.  ICD-10 should have caused an increase in CMI due to the high level of specificity.  If your CMI did not increase, this may be an indicator that the DRG optimization is not being reached.


4. New Official Guidelines for Coding and Reporting for 2017

The cooperating parties (included CMS) have published new coding guidelines that will effect reimbursement. It is important to audit and ensure that coders understand the new guidelines and are applying them correctly.



Information sharing under MACRA will require providers and facilities to share and collaborate in documentation and coding. Payers plan to do crossover audits to ensure that diagnosis and procedures codes are collaborative under value based purchasing.  This will increase the need for outpatient clinical documentation improvement and accuracy of point of service data gathering.  Value based purchasing is a bipartisan legislature and is expected to continue despite repeal of the ACA.


6. Patient Status Audits

CMS has instructed MACs to refer providers who are deficient in assigning patient status - is the patient an observation patient or an inpatient - to the RAC auditors.  Complexity of the new Medicare Outpatient Observation Notice (MOON) and the confusion around the Two-Midnight Rule is making this a challenge for hospitals.  Patient status audits can improve provider scores and prevent disputes and denials regarding patient status.


Prevention and early detection is also important for the health of your revenue cycle.  Auditing is the quickest way to identify and address problem areas before they progress and become harder to cure.


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About the Author:


Laura Legg



Laura Legg, RHIT, CCS, CDIP, AHIMA Approved ICD-10 CM/PCS Trainer, has over 30 years of health information management experience working with acute care hospitals, critical access hospital, and home services.  Laura is an experienced leader, consultant, coding expert, trainer and auditor. Laura is also an experienced speaker and is often called up to speak for national and state AHIMA meetings. Laura continues to help optimize and improve operations for HIM Departments across the nation.

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