For healthcare compliance leaders, financial literacy is not optional. Compliance risk often hides in the fine print of financial data, making literacy a prerequisite for effective oversight.  

To identify anomalies or potential regulatory “red flags,” compliance officers must move beyond a high-level view of healthcare finance and understand how clinical operations translate into financial entries. 

What does a compliance leader need to understand? Things like: 

• Budgeting and capital planning 
• Internal controls and risk 
• Grant and research compliance  
• Key performance indicators (KPIs) 
• Communication between CFO and compliance officer 

Familiarity with the 14 steps of the revenue cycle is also valuable for mitigating risks associated with reimbursements and 340B compliance. (This topic is covered later in the blog.) 

Where Do Healthcare Compliance and Finance Intersect? 

Regulatory compliance and healthcare finance overlap in multiple ways. Compliance-related areas with a financial angle include: 

• Medicare, Medicaid reimbursement 
• 340B drug pricing 
• Stark Law and anti-kickback statutes 
• Charity care 
• Financial assistance requirements  

What Should Compliance Leaders Understand About Financial Statements? 

To build fiscal literacy, let’s start with some foundational concepts – financial statements. Compliance officers should have a basic understanding of these types of statements: 

1. Balance Sheet 
2. Income Statement 
3. Cash Flow Statement 

1. The Balance Sheet: Assessing Financial Integrity Through a “Snapshot” 

The balance sheet provides a snapshot of an organization’s financial health at a specific point in time, detailing its assets, liabilities and equity. 

Why Compliance Should Care: Monitoring the balance sheet helps ensure that assets are properly recorded, and that liabilities like these are appropriately disclosed: 

• Potential legal settlements 
• Debt obligations 
• Medicare overpayments 

2. The Income Statement: Monitoring Operational Risk Over Time 

Unlike the balance sheet snapshot, the income statement tracks revenue and expenses over a specific period, such as a month or a fiscal year. The income statement puts a focus on total revenue and expenses, and the difference between them, while distinguishing between operating and non-operating items. Those two concepts are compared in the chart below. 

In an income statement, it’s important to distinguish between accrual-basis accounting (matching revenue to period it was earned) and cash-basis accounting (recording transactions only when money changes hands). 

Why Compliance Should Care: By comparing current monthly performance against previous years, compliance officers can spot outliers in revenue or sudden spikes in expenses that could indicate billing errors, “upcoding,” or improper financial arrangements under the Stark Law. 

3. The Cash Flow Statement: Ensuring Operational Sustainability 

The cash flow statement tracks the actual movement of cash into and out of the organization, categorized by: 

• Operating activities 
• Investing activities 
• Financing activities 

Why Compliance Should Care: Understanding cash flow is vital for making sure the organization has liquidity to maintain compliance standards even during times of financial strain. A significant discrepancy between reported net income and actual cash flow can signal deep-seated issues with revenue cycle integrity.  

Revenue Cycle as Regulatory Roadmap 

For a prepared healthcare compliance leader, the revenue cycle isn’t just a financial process; it’s a regulatory roadmap. From initial patient interaction to final collection, each step presents a unique set of compliance risks that can lead to audits, fines or loss of reimbursement if not managed with understanding. 

What Compliance “Trapdoors” to Watch for in the Revenue Cycle 

The revenue cycle is full of complexity, largely fueled by the impact of different hospital types (PPS, critical access, disproportionate share, and tribal hospitals) on Medicare and Medicaid rates. 

While the full revenue cycle has 14 distinct stages, compliance officers should pay particular attention to these “trapdoors” where financial operations must meet strict federal regulations: 

• Front-End Integrity (Scheduling and Registration): Accuracy is paramount to ensure Medicare and Medicaid reimbursements aren’t jeopardized by incorrect patient data or lack of prior authorization. 
• Clinical Documentation and Coding: This is a high-density risk area. Compliance must make sure that coding reflects the actual services provided to avoid allegations of “upcoding” or “unbundling,” which can trigger False Claims Act investigations. 
• 340B Drug Pricing Program: If an organization participates in 340B, the revenue cycle needs rigorous internal audits to establish compliance with drug diversion and duplicate discount prohibitions. The stakes will be even higher if the program undergoes potential changes regarding payment models. 
• Billing and Claims Submission: Errors in this stage directly impact the Clean Claim Rate. More importantly, consistent billing errors for federal healthcare programs can lead to significant liability under Anti-Kickback Statutes or the Stark Law if improper financial relationships are found. 

Monitoring Denial Management at Back End of Revenue Cycle 

A robust compliance program monitors the back end of the revenue cycle as closely as the front. Analyzing denials can reveal systemic issues in documentation or billing practices that, if left unaddressed, represent both financial loss and compliance vulnerability. 

What KPIs Should Compliance Watch as Part of Financial Oversight? 

For a healthcare compliance officer, financial data is more than just a reporting requirement. It’s a proactive tool for risk assessment. By monitoring specific KPIs, compliance teams can move from reactive auditing to strategic oversight and identify operational stressors before they escalate into violations. 

The “Big Four” Financial KPIs for Compliance Officers 

Comprehensive financial oversight should track these four metrics: 

• Operating Margin: This measures whether the organization’s core clinical mission is profitable after all operating and overhead costs are paid. A shrinking margin often leads to “cutting corners” in staffing or documentation, which directly increases compliance risk. 
• Days Cash on Hand: This indicates liquidity. How many days can an organization operate using its current cash reserves if all revenue stopped? Higher liquidity provides the financial “breathing room” to maintain compliance and quality standards even during economic downturns. 
• Clean Claim Rate (CCR): A high CCR (ideally 95% or higher) indicates that claims are being submitted without errors the first time. A low rate is a red flag for systemic billing or documentation errors that could trigger federal audits under the False Claims Act. 
• Payer Mix: It’s critical to understand the percentage of revenue coming from Medicare, Medicaid and private insurance. In many healthcare models, Medicare functions as a “break-even” payer, while Medicaid reimbursements often fall below the actual cost of care, placing additional pressure on revenue integrity. 

What to Know about Budgeting and Internal Controls 

Compliance officers should also distinguish between the Operating Budget (daily/annual clinical operations) and the Capital Budget (typically reserved for long-term investments or items over $10,000). 

To prevent fraud and ensure financial integrity, a compliance program must enforce strict segregation of duties. This assures that no single individual has control over all aspects of a financial transaction, serving as a primary defense against embezzlement and improper financial reporting. 

Using the SBAR Tool to Structure CFO and Compliance Communication 

The most effective healthcare compliance programs are those where the Chief Compliance Officer (CCO) and Chief Financial Officer (CFO) operate as strategic partners.  

However, communicating complex compliance risks in a way that aligns with financial priorities requires a structured approach. This is where the SBAR tool (Situation, Background, Assessment, Recommendation) becomes invaluable for justifying financial decisions and resource allocation. (Download a helpful SBAR template at the end of this article)

Four-Step Method for Financial Advocacy 

Use this four-step method to present compliance needs to your finance team: 

• Situation: Clearly state the immediate financial or regulatory issue.  
  Example: “We have identified a 15% discrepancy in our 340B drug pricing audits.” 

• Background: Provide the necessary context and data.  
  Example: Current Medicare reimbursement rates for these drugs are subject to strict transparency requirements. 
   
• Assessment: Offer your professional analysis of the risk.  
  Example: Failure to rectify this documentation gap poses a significant risk to operating margin and regulatory standing and could trigger a federal audit. 
   
• Recommendation: Propose a specific, data-backed solution.  
  Example: “I recommend an immediate investment in automated tracking software as part of the next capital budget cycle.” 

How Compliance Can Secure a “Seat at the Table” 

By confidently speaking the language of finance with terms like liquidity, capital planning and debt financing, compliance officers move beyond being seen as a “cost center” and the “Department of No.”  

Instead, compliance can become a guardian of the organization’s financial sustainability, ensuring that compliance is integrated into every high-level discussion, from annual budgeting to long-term strategic growth.  

Ready to drive more compliance value? Reach out to see how YouCompli can help.  

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The post Financial Literacy: The “Superpower” Every Modern Compliance Leader Needs  first appeared on YouCompli.

Revenue leakage from non-compliance with regulations exposes health systems to compliance risks and penalties. We’ve curated eleven resources to help compliance leaders be better prepared to guide alignment between regulatory compliance processes and revenue integrity goals.

Why Should Compliance Care about the Revenue Cycle? 

Over half of all regulations deal directly with revenue cycle, billing and finance. Most providers still lack an effective system or process to monitor, assess, and validate compliance with those regulations. As a result, these organizations leave themselves open to significant risks, not to mention significant revenue leakage. 

If you need to learn more about the revenue angle of healthcare compliance, these resources are a good place to start. 

Compliance Content by Compliance Experts 

The resources included in this collection Include articles from noted compliance experts including: 

• Shawn Y. DeGroot – CHC-F, CCEP, CHRC, CCPC 
• Maeve O’Neill, MEd – LPC-S, CHC, CDTLF 
• Sharon Parsley – JD, MBA, CHC, CHRC 
• Susan Thomas – CIA, CHC, CPC, CRMA 
• Maya Turner – CPMA, CPCO, CFPC, CPC, CPC-I, AAPC 
• CJ Wolf – MD, CPC, CPC-I, M.Ed. 

Learn from their advice and examples how compliance contributes to revenue performance and launch your own strategies for improvement. 

1. Blog – Mitigating Conflicts of Interest that Drive Profit Over Health  

Integrity First: Mitigating Conflicts of Interest in Clinical Decision-Making 

In healthcare, a conflict of interest (COI) occurs when secondary interests, such as financial ties or institutional goals, threaten to compromise clinical objectivity.  

These conflicts do more than just create ethical dilemmas; they often lead to overutilization of unnecessary tests and treatments, inflating costs for patients and insurers alike. For compliance leaders, addressing COIs is essential to protecting the integrity of the healthcare system and ensuring resources are used appropriately. 

This blog examines the ripple effects of COIs on both patients and providers. It discusses key components of these conflicts and the significant financial impact they have on the entire healthcare ecosystem. 

Inside this resource: 

• Identifying the Triggers: Learn to recognize the financial ties and personal relationships that can bias medical decision-making. 
• The Cost of Overutilization: Understand how unnecessary procedures create financial burdens and exploit the system for gain. 
• Systemic Impact: Explore the broader consequences of COIs, including their role in fraudulent billings. 
• Protecting Objectivity: Strategies for ensuring that clinical judgment remains aligned with the best interests of patients and public health. 

Don’t let hidden interests drive your organization’s clinical path. Read the full blog to learn how to identify and mitigate the conflicts that put your system at risk. 

2. Blog – How to Avoid False Claims Related to Medical Necessity   

Protecting the Bottom Line: Compliance as a Revenue Safeguard 

In the complex world of health system finance, a single coding error can quickly escalate into a multi-million-dollar False Claims Act liability. While Revenue Cycle Management (RCM) focuses on speed and volume, Revenue Integrity ensures that those gains aren’t lost to federal audits or recoupments. 

3. White Paper – Exploring the Four Hot Spots Of the Healthcare Revenue Cycle  

Navigating the Minefield: Mastering the Four Hot Spots of Revenue Integrity 

The healthcare revenue cycle is the financial lifeblood of your organization, but it’s also a landscape filled with hidden regulatory traps. With complexity in payer contracts and government oversight, certain areas have evolved into high-risk “hot spots” that demand immediate, expert compliance scrutiny. 

4. Case Study – Getting It Right: Minimizing Self-identified Overpayments & Maximizing Accurate Billing 

From Regulatory Burden to $400,000 in Savings: The Great River Health Story 

For a small compliance team, staying ahead of complex state coding rules and rapid federal updates is often a losing battle. At Great River Health, this challenge meant spending countless hours manually interpreting regulations, yet the team never felt fully confident that they were catching every risk. They needed a way to move away from constant research and toward decisive action. 

This featured case study explains how Great River Health transformed their compliance program from a source of stress into a vital engine for revenue integrity. By adopting a system that provides validated policy templates and expert regulatory analysis, they shifted their focus from interpretation to implementation. 

5. Blog – Healthcare Compliance is Everybody’s Business: Clinical, Revenue Cycle, IT, Sales and Marketing 

Breaking the Silos: Why Compliance is Everybody’s Business 

To ensure long-term stability, compliance leaders must lead the charge in fostering deep partnerships with clinical, IT, and revenue cycle teams. Compliance can no longer operate in isolation. As governmental and commercial payers deploy increasingly sophisticated programs, the only way to safeguard your organization is through a unified front.  

This blog explores the strategic necessity of internal alliances. It breaks down the specific skills and communication rhythms required to identify systemic risks and avoid the catastrophic penalties associated with “reverse false claims” liability. 

Inside this resource: 

• The Partnership Mandate: Why a strong relationship with your revenue cycle team is your first line of defense against advanced payer audits. 
• Beyond the Surface: Learn how to distinguish between coding-specific denials and medical necessity issues to uncover localized and systemic vulnerabilities. 
• The 60-Day Clock: Understand the critical risks of “reverse false claims” and how to manage the return of overpayments to avoid treble damages. 
• Proactive Governance: How to establish regular cross-departmental meetings that turn compliance from a reactive task into a shared culture of integrity. 

Stop letting departmental silos become a regulatory liability. Read the full blog to learn how to turn every team into a partner for revenue integrity. 

6. Blog – Uncovering $9 Million in Unbilled Services    

The $9 Million Question: How Mock Audits Uncover Hidden Revenue 

Most compliance professionals view mock audits as a shield against fines and regulatory scrutiny. However, when approached strategically, these audits can also act as a powerful engine for revenue integrity. In one striking example, a fresh set of eyes and a few “tough questions” led to the discovery of $9 million in unbilled services. 

This featured blog explores how mock audits do more than just manage risk. They’re a primary tool for building cross-departmental relationships and positioning the compliance team as a high-value partner to the rest of the organization. 

Inside this success story: 

• The “Fresh Eyes” Advantage: Why stepping away from day-to-day tasks to look at the bigger picture is essential for identifying systemic billing gaps. 
• Beyond Revenue Protection: Discover the five strategic benefits of audits, from shaping organizational culture to preventing future penalties. 
• The Power of Simple Questions: See how asking “Do we bill that?” can lead to the biggest dollar-value discoveries of your career. 
• Compliance as a Partner: How to use the audit process to build trust and influence across the business while delivering tangible financial value. 

Stop viewing audits as a burden and start seeing them as an opportunity to prove the financial impact of your compliance program. Read the full story here to learn how to turn your next mock audit into a multi-million-dollar win. 

7. Blog – Compliance Risks Associated with Outlier Payments  

The Chargemaster Trap: Managing the High Stakes of Outlier Payments 

The next resource in our collection focuses on a high-stakes area of reimbursement that often flies under the radar until an audit begins — outlier payments.  

Outlier payments are designed to protect hospitals from significant financial losses on exceptionally costly cases. However, because these supplemental payments are directly tied to hospital charges, they have become a primary target for regulatory scrutiny. If a facility raises its chargemaster prices without clear justification, it can artificially inflate these payments and trigger intense external audits. 

This blog explores the delicate balance between revenue protection and compliance risk. We examine real-world audit findings where simple human errors and system glitches led to hundreds of thousands of dollars in overpayments and potential penalties. 

Inside this resource: 

• The Scrutiny Factor: Understand why enforcement agencies are actively monitoring price increases that lead to spikes in outlier reimbursement. 
• Lessons from the Field: Review the 2020 OIG audit of an Arkansas facility that found over $580,000 in overpayments due to time-tracking and coding errors. 
• The Human Error Risk: Learn how “hardcoded” charges and misaligned supply items can create systemic billing inaccuracies that go undetected for years. 
• Strategic Collaboration: Discover why a close partnership between compliance, finance and reimbursement teams is the only way to safeguard your organization against these risks. 

Stop letting unjustified price adjustments put your hospital at risk for recoupment and penalties. Read the full blog here to learn how to proactively audit your outlier claims and maintain regulatory integrity. 

8. Blog – The Cost of Non-Compliance  

Beyond the Fine: Calculating the True Price of Non-Compliance 

In the budgeting process, the cost of non-compliance is often a forgotten line item until it becomes a hard reality. While hefty fines for HIPAA or Medicare violations are the most visible risks, they’re only the beginning.  

For healthcare organizations, the true cost includes a cascade of legal fees, operational disruptions and long-term reputational damage that can be difficult to quantify but impossible to ignore. 

This piece explores how to move beyond reactive firefighting and toward a model of operational excellence. We discuss how to use Corporate Integrity Agreements (CIAs) as a powerful benchmarking tool to identify systemic vulnerabilities before they lead to federal intervention. 

Inside this resource: 

• The Tangible and Intangible: Learn how to communicate the full spectrum of risk to your board, from immediate settlement costs to the lasting impact on patient trust. 
• Contract Integrity: Focus on the critical importance of auditing physician and medical director contracts to prevent Stark Act and Anti-Kickback Statute violations. 
• A Culture of Excellence: Understand why investing in compliance is not just a legal obligation but a cornerstone of your organization’s commitment to patient care and operational stability. 

Stop viewing compliance as a cost center. Read the full blog to learn how a proactive approach to auditing and monitoring can safeguard your organization’s future. 

9. Blog – How to Avoid Compliance Risk in Peripheral Vascular Reimbursement   

Under the Microscope: Navigating Peripheral Vascular Reimbursement Risks 

Peripheral vascular disease (PVD) reimbursement has become a lightning rod for regulatory scrutiny. With alarming statistics regarding improper payments and a surge in whistleblower investigations, health systems cannot afford to treat these interventions as routine billing.  

For compliance leaders, the challenge lies in ensuring that every procedure meets stringent medical necessity guidelines before a claim is ever submitted. 

This expert-led blog provides a deep dive into the regulatory trends and enforcement patterns currently shaping the vascular space. It provides technical insights and best practices your team needs to safeguard your organization’s reputation and financial stability. 

Inside this resource: 

• Medicare Compliance Mastery: Understand the specific documentation and coding requirements that federal auditors target in vascular interventions. 
• Fraud Warning Signs: Learn why high volumes in vascular reimbursement are triggering red flags for the OIG and how to stay ahead of these investigations. 
• Recent Investigation Insights: Review lessons learned from recent whistleblower cases that focused specifically on PVD compliance failures. 
• Best Practices for Integrity: Actionable strategies to align clinical documentation with reimbursement guidelines to ensure every claim is defensible. 

Stop letting PVD reimbursement become a vulnerability in your revenue cycle. Read the full blog here to equip your team with the knowledge to navigate this complex environment. 

10. Blog and Tip Sheet – Revenue Cycle Management Compliance: Ensuring Financial Health in Healthcare  

Financial Integrity: Mastering Revenue Cycle Management Compliance 

Revenue Cycle Management (RCM) is the essential financial engine of any healthcare provider, managing everything from claims processing to final payment.  

However, the efficiency of this cycle depends entirely on its alignment with regulatory standards. Without a foundation of strict compliance, even the most streamlined revenue process is at risk of legal repercussions and compromised financial integrity. 

11. Blog and Tip Sheet – Three Strategies to Align Compliance with Revenue Cycle  

Strategic Synergy: Bridging the Gap Between Compliance and Revenue Cycle 

For healthcare organizations, the revenue cycle is the financial lifeblood. However, when compliance and revenue cycle management operate in silos, the resulting friction creates significant regulatory and financial risks.  

To protect the bottom line and ensure long-term sustainability, compliance leaders must lead the charge in aligning these two critical functions. 

Stop letting a lack of alignment become a financial liability. Explore how these three strategies can transform your compliance program into a vital partner for revenue integrity.  

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The post 11 Educational Resources on Revenue Cycle and Healthcare Compliance  first appeared on YouCompli.

A good healthcare compliance program is all about reducing risk, both in patient care and in financial reimbursement. This detailed blog by compliance expert, CJ Wolf, will bring you up to date on the compliance risks associated with certain anesthesia services.   

The OIG just published audit results and report (July 31, 2025) outlining the issues in this area. This article is a summary of that report, along with what it might mean for compliance professionals.  

The implications can be huge. For example, OIG concluded that Medicare paid $45.7 million for anesthesia services provided during the SPM procedure sessions that were at risk for noncompliance with Medicare requirements.  

What to Know About Anesthesia, Compliance and the Latest OIG Audit 

The U.S. Department of Health and Human Services Office of Inspector General (OIG) recently released a nationwide audit report highlighting potential improper payments for anesthesia services provided during select spinal injection procedures  

It is only under rare circumstances that Medicare Part B covers the cost of anesthesia during certain spinal pain management (SPM) procedures. In fact, a prior OIG audit found that 27% of billed anesthesia services during SPM procedures did not have supporting medical documentation that would justify the use of anesthesia.  Given these circumstances, the OIG decided to perform the more recent nationwide audit and publish its findings. 

Goal of OIG Audit Regarding Medicare Part B Payments 

The OIG’s goal in the audit was to identify Medicare Part B payments to physicians for anesthesia administered during selected SPM procedures that were at risk for noncompliance with Medicare requirements. 

The specific SPM procedures included in the audit were: 

• Facet-joint injections 
• Facet-joint denervation (aka radiofrequency ablation) 
• Epidural steroid injections 
• Sacroiliac joint injections 

Medicare Coverage Only in Rare Circumstances 

As mentioned, it is only in rare circumstances that Medicare covers the cost of certain anesthesia services provided during SPM procedures. The types of anesthesia services that could potentially be covered under these rare circumstances include: 

• Moderate sedation: Administration of a drug-induced depression of consciousness during which a patient responds purposefully to verbal commands, either alone or accompanied by light tactile stimulation. No interventions are required to maintain the enrollee’s airway, and spontaneous ventilation is adequate. 

• General anesthesia: Administration of a drug-induced loss of consciousness during which a patient is not arousable, even by painful stimulation. The ability to independently maintain breathing is often impaired. The patient often requires assistance in maintaining an open airway that allows for adequate airflow and proper oxygenation of the lungs. Positive pressure ventilation may be required because of depressed spontaneous ventilation or drug-induced depression of neuromuscular function. 

• Monitored anesthesia care: This is a specific anesthesia service for a diagnostic or therapeutic procedure. Indications for monitored anesthesia care include the need for deeper levels of analgesia (i.e., the inability to feel pain) and sedation than can be provided by moderate sedation. Monitored anesthesia care falls between moderate sedation and general anesthesia. 

MAC LCDs Published for Select SPM Procedures 

Medicare Part B claims are adjudicated and paid by Medicare Administrative Contractors (MAC).  MACs are charged with ensuring proper payment of claims.  They are to safeguard Medicare funds against improper medical coding and billing, fraud and abuse. One way they do this is by publishing local coverage determinations (LCDs) which outline when certain services are, or are not, covered. 

The MAC LCDs for the selected SPM procedures explain that the use of moderate sedation, general anesthesia, and monitored anesthesia care is usually unnecessary or rarely indicated for these procedures. However, individual consideration may be given in rare cases when documentation clearly established the need for such anesthesia. 

Audit to Confirm Compliance with Limited Coverage Rules 

The OIG wanted to confirm compliance with these limited coverage rules for anesthesia services billed along with the SPM procedures. To do so, they identified an audit period consisting of claims for SPM procedure dates of service between May 2, 2021, and August 31, 2023, during which Medicare paid for 3.9 million sessions of SPM procedures.   

For this audit period, physicians billed for anesthesia services nearly 18% of the time. The MACs paid $46.2 million for the anesthesia services or 99.5% of the time that anesthesia was billed during the same SPM procedure session. 

Then, the OIG identified and selected a nonstatistical sample of 28 sessions where both anesthesia and the selected SPM procedures were billed. To verify compliance, the OIG obtained the supporting medical documentation for these sessions and had an independent medical reviewer determine whether the anesthesia was medically necessary and met the rare circumstances when Medicare would cover the anesthesia service.  

Medical Records Fail to Document Necessity 

For 20 of the 28 sampled sessions, the medical reviewer determined the supporting medical records did not document a rare circumstance in which administering anesthesia was reasonable or necessary for the specific SPM procedure.   

One such example included a session where a physician administered moderate sedation to a patient during an epidural steroid injection session. The medical records provided by the physician stated that this type of anesthesia was administered because of the patient’s anxiety, which is not a medically necessary indication meeting coverage criteria according to the LCD. The medical records also did not have evidence of failed oral sedation, which could have necessitated moderate sedation. 

The OIG stated they could not provide an overall estimate of improper payments for the entire audit period because the sample they used was a nonstatistical sample. However, they concluded that Medicare paid $45.7 million for anesthesia services provided during the SPM procedure sessions that were at risk for noncompliance with Medicare requirements. 

OIG Recommendations Include Provider Education 

One of the more significant recommendations the OIG made for CMS and the MACs is to  

• Educate providers on the coverage criteria 
• Review claims for improper billing of anesthesia services 

For providers, this means your MAC may begin auditing such claims. 

Compliance Tip for Anesthesia Billing 

Compliance professionals should assess how often their organizations bill anesthesia services at the same time as the SPM procedures and review the medical records to determine if the sessions meet the rare circumstances found in the LCD requirements for coverage of both services. 

More Resources about Compliance Risks 

Continue learning about the complexities of Medicare reimbursement and compliance in these other piece by CJ Wolf. 

Compliance Risks Associated with Outlier Payments 

In some circumstances, payers like Medicare, for example, will reimburse additional amounts beyond the prospective payment rate. These additional payments are called “outlier payments.” Outlier payments provide additional reimbursement for cases of exceptionally costly treatments.   

How to Avoid Compliance Risk in Peripheral Vascular Reimbursement   

Peripheral vascular disease (PVD) reimbursement is fraught with potential compliance pitfalls. This expert-written blog addresses the pressing concern of compliance risks in PVD reimbursement. It provides insights into regulatory trends, recent investigations and best practices. It provides insights into regulatory trends, recent investigations and best practices. 

CJ Wolf, MD, M.Ed. is a healthcare compliance professional with over 22 years of experience in healthcare economics, revenue cycle, coding, billing, and healthcare compliance. He has worked for Intermountain Healthcare, the University of Texas MD Anderson Cancer Center, the University of Texas System, an international medical device company and a healthcare compliance software start up. Currently, Dr. Wolf teaches and provides private healthcare compliance and coding consulting services as well as training.   

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The post Know the Compliance Risk for Certain Anesthesia Services  first appeared on YouCompli.

Peripheral vascular disease (PVD) reimbursement is fraught with potential compliance pitfalls. With increased scrutiny and worrisome statistics about improper payments, healthcare providers must identify and mitigate any PVD compliance risks that could jeopardize their operations.  

This expert-written blog addresses the pressing concern of compliance risks in PVD reimbursement. It provides insights into regulatory trends, recent investigations and best practices.  

Equip yourself with the knowledge to navigate this complex environment and safeguard your organization’s reputation and financial sustainability. Learn effective strategies to mitigate compliance risks in peripheral vascular reimbursement by focusing on medical necessity and adherence to guidelines. 

What’s your compliance risk when it comes to reimbursement for specific medical procedures like peripheral vascular interventions (PVD)? 

Hospitals, health systems and medical practices providing peripheral vascular procedures should be aware of recent scrutiny of these services by government enforcement agencies. 

What Therapies Target Peripheral Vascular Disease? 

Peripheral vascular disease can result in the narrowing or blockage of arteries in the periphery, such as the lower extremities. There are many different therapies to address PVD, including the typical first-line treatment of lifestyle changes and medications.  Lifestyle changes include quitting smoking, eating a healthy diet low in saturated fats, regular exercise and weight management. Some PVD medications include the statin class of drugs, antiplatelet agents, ACE inhibitors and others.   

If lifestyle changes and medications don’t work, and certain clinical criteria are met, patients can undergo peripheral vascular procedures. These are minimally invasive procedures intended to improve blood flow through the arteries. Angioplasties, atherectomies and placement of stents are types of peripheral vascular procedures. 

OIG Looks at Compliance Risk in PVD Reimbursement  

Enforcement agencies are concerned with the increasing volume of these procedures. The problem relates to suspicions that some clinicians perform these procedures when they’re not medically necessary. 

The HHS OIG has added two different projects to their work plan related to peripheral vascular procedures. The first is “Utilization of Peripheral Vascular Procedures and CMS’s Related Program Integrity Efforts.” They report that in one calendar year, Medicare paid more than $600 million for atherectomies and angioplasties in peripheral arteries with and without a stent.   

Editor’s Note: The Work Plan is a guide to OIG priorities around oversight and compliance. By reviewing the Work Plan, health systems can identify potential compliance risks and proactively take action to mitigate them. 

Fraud Concerns Over Vascular Reimbursement Volume 

The OIG also states that both CMS and whistleblower fraud investigations have identified these surgeries as vulnerable to improper payments. This particular project is designed to determine trends in Medicare fee-for-service for surgeries in peripheral arteries over several years and identify paid claims that exhibit questionable characteristics.  

The OIG will also describe program integrity activities that CMS and its contractors have taken to combat fraud, waste and abuse specific to procedures in peripheral arteries. The report is expected to be issued in 2026. 

Understanding Medicare Compliance for Vascular Interventions 

The second work plan project is named “Medicare Payments for Lower Extremity Peripheral Vascular Procedures.” The OIG reports that peripheral vascular procedures in an office setting have increased among the Medicare population over the past decade.  

In fact, OIG says for calendar years 2022 and 2023, Medicare paid approximately $1.16 billion for lower extremity peripheral vascular procedures in office settings. Their concern is that these procedures are generally recommended only after patients have exhausted medical and exercise therapy and have lifestyle-limiting symptoms.  

The OIG plans to analyze Medicare fee-for-service for peripheral vascular procedures for questionable characteristics. They would also like to assess whether these procedures complied with CMS requirements and met applicable treatment guidelines. This report is expected to be released in 2025 under report number W-00-24-35914. 

Whistleblower Fraud Investigations Find Compliance Issues 

The OIG reported that there have been some whistleblower fraud investigations concerning these procedures. One case recently occurred in Florida where the whistleblower was a physician who claimed a vascular center and its providers were performing and billing for medically unnecessary peripheral vascular procedures.   

The government intervened in the case and alleged the providers submitted false claims to Medicare for percutaneous transluminal angioplasties that were not reasonably or medically necessary because they were performed without appropriate diagnostic imaging or clinical justification.   

The case was resolved when the medical providers agreed to pay $810,301, of which $337,625 was restitution. The defendants also agreed to pay $85,000 for the whistleblower’s reasonable expenses, including attorneys’ fees and costs. 

Report: Faster Treatment, Higher Costs with Office Procedures 

The Journal of Vascular Surgery published a report in June 2024 that concluded Medicare patients with peripheral artery disease are treated more quickly but undergo higher cost interventions in office-based laboratories compared to outpatient hospital settings. 

The authors used publicly available Medicare fee-for-service claims data spanning a five-year period that identified all patients undergoing certain peripheral procedures for certain conditions. They then evaluated the associations of patient and procedure characteristics with the site of service. 

Steps for Compliance in Peripheral Vascular Reimbursement 

So, what’s a compliance officer to do?  The first step is to determine the level of involvement the organization has in these particular procedures.  

If found to be significant, it’s probably wise to evaluate the clinical guidelines and policies in place for use of peripheral vascular procedures. Most organizations have a medical director or department chair who could guide a review to determine if procedures are medically necessary.  

Seek Out External Resources about PVD Compliance 

Alternatively, seeking external expertise is also an option. Though professional societies’ clinical practice guidelines are not the “end-all,” it might be useful to reference such guidelines as a starting point.  

These might include: 

• Society of Vascular Surgery

• American College of Cardiology/American Heart Association Joint Committe

• Society of Interventional Radiology

Best Practices for Peripheral Vascular Procedure Compliance  

Most compliance programs only perform medical coding reviews of the procedure documentation, but the OIG suggests including medical necessity audits as well. In their General Compliance Program Guidance (GCPG) document, they state, “Medicare requires, as a condition of payment, that items and services be medically reasonable and necessary.  

“Therefore, entities should ensure that any claims reviews and audits include a review of the medical necessity of the item or service by an appropriately credentialed clinician. Entities that do not include clinical review of medical necessity in their claims audits may fail to identify important compliance concerns relating to medical necessity.” 

Given this, compliance professionals shouldn’t ignore the question of medical necessity for peripheral artery procedures. Scrutiny of these services continues to be a priority for the OIG and their work plan as well as the Department of Justice, as evidenced by cases that result either from data analytics or whistleblowers. 

Confident Compliance Starts Now 

YouCompli customers are confident in their approach to compliance challenges like managing PVD reimbursement. Learn more about the unique combination of expert human analysis and digital compliance management tools. 

CJ Wolf, MD, M.Ed. is a healthcare compliance professional with over 22 years of experience in healthcare economics, revenue cycle, coding, billing, and healthcare compliance. He has worked for Intermountain Healthcare, the University of Texas MD Anderson Cancer Center, the University of Texas System, an international medical device company and a healthcare compliance software start up. Currently, Dr. Wolf teaches and provides private healthcare compliance and coding consulting services as well as training.   

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The post How to Avoid Compliance Risk in Peripheral Vascular Reimbursement   first appeared on YouCompli.

Aligning healthcare regulatory compliance with revenue cycle management is critical to mitigating risks and preserving business integrity. This blog explores three effective strategies to foster collaboration between compliance teams and revenue cycle management.  

Some of the most significant compliance risks faced by healthcare organizations today are found in the revenue cycle. The HHS OIG has stated, “One of the best ways to identify fraud and abuse risks is to follow the money.” 

For many healthcare organizations, this means having a good working relationship with the entity’s revenue cycle team.  

The revenue cycle is the process that starts with a patient’s initial appointment and ends with full payment for services. It encompasses all the administrative and clinical functions that contribute to collecting patient service revenue.  For healthcare organizations that provide services to patients, the revenue cycle is the organization’s financial lifeblood. 

3 Ways Compliance Can Stay Connected with RCM 

If compliance has a good working relationship with revenue cycle management, the two functions can enjoy a fruitful outcome.  

Compliance professionals should consider the following three ways to interact with the revenue cycle team. 

1. Regular Collaboration 

We know from OIG guidance documents that, to be effective, the compliance officer should maintain a degree of separation from the entity’s delivery of healthcare items, services, and related operations.  

Even though this means the compliance officer should not be responsible, either directly or indirectly, for the delivery of healthcare items and services or billing, coding, or claim submission, it does not mean the compliance officer should not be well-versed in these functions through regular communication and collaboration. 

Take Advantage of Compliance Committee Connections 

Regularly collaborating with the revenue cycle team will inform compliance professionals of the specific risks and potential compliance red flags the revenue cycle may be facing.  Many organizations ensure this collaboration by having revenue cycle leadership serve on the organization’s compliance committee.  

In fact, the OIG states the compliance committee “…should be comprised of the relevant leaders of both operational and supporting departments, which could include Billing and Coding, Clinical and Medical, Finance, Internal Audit, IT, HIM, Human Resources, Legal, Quality, Risk Management, Sales and Marketing, and other operational managers.”  Most of the departments suggested by the OIG play a role in the revenue cycle. 

In addition to revenue cycle personnel participating in the compliance committee, collaboration between compliance and revenue cycle can occur on a weekly basis through meetings and sharing of revenue cycle data such as denial rates, reports from electronic claims editors, communications from third party payors and any internal coding and billing monitoring the revenue cycle is performing. 

2. Proactive Claims Auditing  

The OIG tells healthcare providers that they “…should take proactive measures to ensure compliance with program rules, including regular reviews to keep billing and coding practices up to date as well as regular internal billing and coding audits.” 

In organizations that submit claims for services, a sizable number of resources should be dedicated to ensuring the claims they are submitting for reimbursement meet all program requirements.  

The revenue cycle team should have monitoring efforts in place for correct coding and billing.  Also, compliance departments should ensure that independent claims audits are also occurring regularly. 

Assisting Revenue with 60-Day Repayment Rule Requirements  

Even if an entity makes innocent billing mistakes, they have an obligation to repay the money to government third-party payers such as Medicare and Medicaid. The Affordable Care Act included a requirement that entities must report and repay overpayments by the later of: “(A) the date which is 60 days after the date on which the overpayment was identified; or (B) the date any corresponding cost report is due, if applicable.”  Sometimes this is referred to as the 60-day repayment rule. 

If a revenue cycle team’s internal monitoring identifies overpayments, it is critical for compliance departments to know the date of discovery, so the organization does not run afoul of the 60-day repayment rule. If the entity does not monitor the repayment requirements, they could be subject to liability under the Federal False Claims Act. 

3. Training and Education Geared to Job Roles 

Coding and billing rules are regularly updated and can change frequently, and it’s often difficult for busy clinicians to stay on top of the changing regulations. Compliance and revenue cycle teams should work together to ensure those involved in revenue cycle functions are educated on the most current rules. 

The OIG recommends targeting training depending on an individual’s role. Thus, those involved in revenue cycle operations need to provide training and education specific to the nuances of the revenue cycle. The training sessions should cover any compliance risks specific to the learners’ roles and responsibilities.  

Depending on the learners’ roles, these may include: 

• Billing 
• Coding 
• Documentation 
• Medical necessity 
• Beneficiary inducements 
• Gifts 
• Interactions with physicians  
• Other sources or recipients of referrals of federal healthcare program business 

Three Ways to Show You Follow the Money

If healthcare organizations are going to address their biggest compliance risks, they must include the revenue cycle. Compliance professionals can lead in addressing revenue cycle risks by: 

• Driving effective collaboration between compliance and revenue cycle teams 
• Verifying that proper auditing and monitoring of claims are occurring  
• Ensuring those involved in revenue cycle receive targeted training based on their specific role.  

Doing these three things helps show your compliance program is indeed “following the money” as suggested by enforcement agencies such as the OIG. 

About Solutions for Compliance Management and Operations 

Need help keeping track of everything going on in regulatory management? When multiple people and departments are involved, the last thing stretched compliance teams need is more manual work.  

YouCompli compliance solutions keep cross-functional engagement organized, verified and on schedule.  

• Identify and assign specific individuals responsible for completing regulatory requirements. 
• Track progress and on-time completion of all regulatory requirements. 
• Verify that regulatory requirements have been acted upon within the organization. 
• Gauge and quantify potential areas of risk related to incomplete regulatory requirement assignments. 

Detailed reports equip compliance teams with oversight information they need to effectively communicate, act on, monitor, and focus organizational compliance efforts. 

Combine YouCompli solutions with the three best practices in this blog to build productive connections with Revenue and other departments.  

More Resources About Revenue Cycle Management and Compliance 

If you’re interested in learning more about the Revenue angle of healthcare compliance, here are a few additional resources: 

White Paper: Exploring the Four Hot Spots Of the Healthcare Revenue Cycle 

Case Study: Getting It Right: Minimizing Self-identified Overpayments & Maximizing Accurate Billing 

Tips and Tactics: Revenue Cycle Management Compliance: Ensuring Financial Health in Healthcare 

CJ Wolf, MD, M.Ed. is a healthcare compliance professional with over 22 years of experience in healthcare economics, revenue cycle, coding, billing, and healthcare compliance. He has worked for Intermountain Healthcare, the University of Texas MD Anderson Cancer Center, the University of Texas System, an international medical device company and a healthcare compliance software start up. Currently, Dr. Wolf teaches and provides private healthcare compliance and coding consulting services as well as training.   

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27 Ungated Resources for Compliance Leaders and Teams 

Compliance professionals sometimes feel undervalued in comparison to other functions in their organization. They think leaders and colleagues don’t really understand what they do.  

These resources will help. Packed with ideas, tips and recommendations, these pieces were written by professionals with many years of compliance experience. 

You can quickly skim for articles that relate to your needs and interests. Bookmark this page as a reference for future questions or projects.

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The post Three Strategies to Align Compliance with Revenue Cycle  first appeared on YouCompli.

Nowadays, rarely does a week go by without the Department of Justice announcing another settlement related to allegations of a lack of medical necessity resulting in false claims. It’s a significant black eye for the healthcare compliance industry – one that compliance professionals should constantly be working to avoid.  

As they do so, they should keep the following tips in mind as they assess and monitor the medical necessity of claims. 

Tip #1 – Insurance Coverage 

When speaking with clinicians, make sure to clarify that medical necessity billing risks are not necessarily an attempt to second-guess a clinician’s decision for care, but rather an insurance coverage issue. For example, “the OIG recognizes that physicians should be able to order any tests, including screening tests, they believe are appropriate for the treatment of their patients. However, a physician practice should be aware that Medicare will only pay for services that meet the Medicare definition of reasonable and necessary.”¹ 

Too often, compliance professionals lead the conversation with a statement that “the services were not medically necessary.” Instead, they could say, “the services did not meet Medicare’s definition of medical necessity or coverage.” 

Tip #2 – LCDs and NCDs 

Help revenue cycle professionals and clinicians become aware of the local Medicare Administrative Contractor’s (MAC) local coverage determinations (LCD) and Medicare’s national coverage determinations (NCD). These policies outline coverage criteria for specific services identified by medical codes. In many LCDs, there are narrative descriptions of expectations before Medicare considers the services medically necessary.  For example, one MAC’s LCD for spinal facet joint injections requires documented failure of attempts for conservative therapy to treat the patient’s pain before performing spinal injections. Specifically, it states the medical record of the patient must demonstrate “pain present for minimum of 3 months with documented failure to respond to noninvasive conservative management (as tolerated).” So, clinicians who order or perform facet joint injections run the risk of the claims being “medically unnecessary” or not covered under the LCD. Other LCDs also have similar narrative descriptions outlining expectations for coverage, or for what the local MAC considers to be “medically necessary.” 

Tip #3 – Maximize Clinical Training 

Auditing and monitoring for medical necessity can be a challenge because many compliance programs do not employ individuals with medical training. These people are usually in the best position to determine whether the services meet medical necessity requirements. Most compliance programs do, however, ensure that medical claims submitted to payors are audited and/or monitored by certified medical coders who assess whether the codes reported are supported by the medical documentation.  

Still, most medical coders are not clinically trained, nor do they usually perform medical necessity reviews when they are performing coding audits. With this in mind, compliance programs should involve individuals with at least some clinical training to perform auditing and monitoring with an eye on medical necessity. It does not always need to be a clinical specialist involved at the beginning of an audit or monitoring procedure. Such individuals with basic clinical training can screen claims for medical necessity, and if/when a more formal opinion is needed they can then engage clinicians who have specialized training in a particular treatment or procedure.  

Conclusion 

There is no silver bullet to solving medical necessity risks as they relate to medical claims submitted to payers such as Medicare. That said, these tips can be a starting point for compliance programs who know they need to minimize their compliance risk around medical necessity. 

Download CJ’s tip sheet below

CJ Wolf, MD, M.Ed. is a healthcare compliance professional with over 22 years of experience in healthcare economics, revenue cycle, coding, billing, and healthcare compliance. He has worked for Intermountain Healthcare, the University of Texas MD Anderson Cancer Center, the University of Texas System, an international medical device company and a healthcare compliance software start up. Currently, Dr. Wolf teaches and provides private healthcare compliance and coding consulting services as well as training.  

Qualified compliance professionals do the heavy lifting for you, simplifying regulatory change management   

Our in-house team works tirelessly to monitor U.S. regulators, carefully read the regulations in their entirety, and translate the information into simple regulatory intelligence you can use. We deliver model procedures and expert tools that can be used to fulfill your business requirements. Everything is validated by a third-party law firm. Follow the button below to get a tour of our healthcare compliance software.  

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The post How to Avoid False Claims Related to Medical Necessity   first appeared on YouCompli.

Revenue Cycle Management (RCM) is the financial process utilized by healthcare providers to manage the administrative and clinical functions associated with claims processing, payment, and revenue generation. The primary goal of RCM is to improve the efficiency of the revenue cycle and ensure that healthcare providers receive timely payments for the services they offer.  

A critical aspect of effective RCM is compliance with regulatory standards, which creates financial integrity and reduces legal repercussions. When thinking of compliance in the revenue cycle, the key factor is to BE compliant. Without such practices in place, revenue integrity would inadvertently become compromised. 

In this tip sheet, we explore the importance of compliance in revenue cycle management, the challenges involved, and best practices for maintaining compliance. 

Importance of Compliance in Revenue Cycle Management 

Here are some key factors when considering the importance of compliance in the revenue cycle. 

1. Legal and Regulatory Adherence: Compliance ensures that healthcare providers adhere to laws and regulations such as the Health Insurance Portability and Accountability Act (HIPAA), the Affordable Care Act (ACA), and various state laws. This adherence is crucial to avoid legal penalties and sanctions. 
2. Financial Stability: Proper compliance helps in accurate billing and coding, reducing the risk of claim denials and delays. This accuracy is vital for maintaining steady cash flow and financial stability. 
3. Patient Trust and Satisfaction: Patients will lean closely to healthcare providers who demonstrate transparency and integrity in their billing practices. Compliance with regulations fosters this trust, leading to higher patient satisfaction and loyalty. 
4. Avoidance of Penalties: Non-compliance can result in severe financial penalties, loss of licensure, and exclusion from federal healthcare programs. Maintaining compliance helps avoid these detrimental outcomes. 

There could be many more, but the key here is understanding the OIG has put regulations in place for the revenue cycle with good reason. Be sure your organization understands these regulations and has a team in place to review and/or put in place policies that can comply with the revenue cycle. 

All of this said, this isn’t easy. It’s understandable to have challenges with becoming compliant. The key is getting professional assistance and trying not to handle such a big task on your own. Just know with compliance there are challenges not only with operations but the overall complexity of getting it within a fluid process.  

Challenges in Revenue Cycle Management Compliance 

There are four main types of challenges that may occur when aiming to become compliant. 

1. Complex Regulatory Environment: The healthcare industry is subject to complex federal, state, and local regulations, and they change frequently. Keeping up with these constantly evolving regulations is a significant challenge for healthcare providers. Knowing the granularities associated with these changes is crucial in revenue cycle compliance.  
2. Data Security: Protecting patient information is paramount, especially with the increasing threat of cyberattacks. Compliance with data protection regulations like HIPAA requires robust security measures and constant vigilance. 
3. Billing and Coding Accuracy: Accurate medical coding and billing are critical for compliance. Errors in coding can lead to claim denials, audits, and penalties. Having coding compliance professionals and policies in place reduces financial vulnerability. It also ensures accuracy, which in turn requires continuous training and education for coding professionals. 
4. Resource Constraints: Smaller healthcare facilities often struggle with limited resources, making it challenging to implement comprehensive compliance programs. This limitation can lead to gaps in compliance and increased risk of violations. 

When putting together policies or even beginning to understand how to implement compliance within your organization, be certain to understand each department’s function – and make sure they are represented when making decisions. Typically, boards include directors who represent departments that may be affected.  

Best Practices for Maintaining Compliance 

Let’s look at some other best practices in revenue cycle compliance. 

1. Regular Training and Education: Continuous training for staff on the latest regulations and compliance requirements is essential. This training should cover coding accuracy, data security, patient privacy, and ethical billing practices. It’s important to know the type of training, if it’s based on a focused need or generalized need based on focused review or deficiency, if needed. Having a diverse coding compliance program and understanding the significant roles of how they interact is especially important.  
2. Implementing Robust Policies and Procedures: Developing and enforcing clear policies and procedures for all aspects of RCM ensures consistent compliance. These policies should be regularly reviewed and updated to reflect changes in regulations. Understanding and reviewing policies as regulations change is especially important in the ever-changing scope of healthcare and regulations become especially important.  
3. Utilizing Technology: Leveraging advanced RCM software and tools can enhance accuracy and efficiency. Automated systems can help detect errors, streamline workflows, and ensure adherence to regulatory standards. EMR systems also can help with the appropriate edits, but they do need to be monitored carefully to assist with payer policies. Utilizing this function can be helpful if there is proven viability with its function and programming.  
4. Conducting Regular Audits: Regular internal and external audits help identify compliance gaps and areas for improvement. These exercises provide an opportunity to correct issues before they escalate into larger problems. A coding compliance and/or revenue integrity team can assist, as they typically follow regulatory standards issued by federal entities. This, in addition to having company policies in place, reduces the risk of an audit.  
5. Engaging Compliance Experts: Consulting with compliance experts and legal advisors can provide valuable insights and guidance. These professionals can help navigate complex regulations and develop effective compliance strategies. They also are crucial to RCM compliance success because they can help implement improvement plans to help providers and/or facilities comply when submitting for payment.  

These best practices may seem daunting at first. But, once implemented, they become worth the effort. Having well-balanced compliance within your organization keeps anxieties low and minimizes surprises relating to queries regarding revenue integrity.  

Conclusion 

Revenue cycle management compliance is crucial for the financial health and operational success of healthcare providers. By adhering to regulatory standards, ensuring accurate billing and coding, and protecting patient information, healthcare facilities can avoid legal repercussions and maintain patient trust. Implementing best practices such as continuous training, robust policies, and leveraging technology can significantly enhance compliance efforts. A proactive approach to RCM compliance not only safeguards against penalties but also contributes to the overall efficiency and effectiveness of healthcare delivery.  

Download PDF Tip Sheet

Maya Turner, CPMA, CPCO, CFPC, CPC, CPC-I, AAPC, is the founder and managing director of Turner Expert Consulting Services. She is a certified professional coder with 30 years of experience in all components of healthcare coding and reimbursement, revenue cycle management, compliance, and inpatient and outpatient billing. 

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27 Ungated Resources for Compliance Leaders and Teams 

Compliance professionals sometimes feel undervalued in comparison to other functions in their organization. They think leaders and colleagues don’t really understand what they do.  

These resources will help. Packed with ideas, tips and recommendations, these pieces were written by professionals with many years of compliance experience. 

You can quickly skim for articles that relate to your needs and interests. Bookmark this page as a reference for future questions or projects.

Visit Now

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The post Revenue Cycle Management Compliance: Ensuring Financial Health in Healthcare  first appeared on YouCompli.

Mock audits deliver value for healthcare    

Mock audits are an incredible tool for compliance officers to protect a healthcare organization’s revenue and add tangible value. They are time consuming, but they can dramatically advance your compliance program.  

Beyond protecting revenue, audits are effective ways to help organizations prevent fines. They’re also key to how compliance officers build relationships across the organization, shape the culture, and position Compliance as a true partner.   

 I’ll prove all of this by telling you about the $9 million in unbilled revenue I found in one mock audit. This success story is evidence of how Compliance brings value to leaders and influences culture, while helping the organization better manage and control risk.  

The Mad Dash in Revenue Cycle  

Revenue Cycle is a huge investment for any healthcare organization. It’s particularly true in behavioral health; many of our organizations were established from nonprofit work or federal grants.   

There wasn’t always a lot of money in the behavioral health field. But in recent years, with the Affordable Care Act and managed care coming in to cover services, it’s been a mad dash to figure it all out. How do we capture revenue? How do we bill for it, document for it and, of course, collect it?   

Behavioral health and many smaller healthcare organizations are working to put all the processes in place. Compliance should be involved because we’re integrated into all aspects of the organization, from HR and operations to clinical services and finance.

The Tough Questions  

With revenue protection, our role in Compliance is to be aware, ask questions, and determine which parts to monitor and audit. We need to be a fresh set of eyes for the organization, looking at all points of care.   

Compliance officers are responsible for asking the tough questions during audits: Do we bill that? Do we get paid for that?   

We’re usually distanced enough from the operational departments’ daily work that we can ask the questions no one else has the time to ask. Our questions may be ones that other people are afraid to ask because it’s not their role to look into it.  

As a former behavioral health surveyor with the Joint Commission, I’m comfortable with this role. A good mock survey covers all the aspects of a Joint Commission survey – the environment of care, HR, staff records, and client records.   

When I do mock surveys, I pretend to be with the Joint Commission. Everyone takes it seriously. My job is to find opportunities to improve because everyone in operational departments is so busy and distracted, putting out fires in their day-to-day work.   

For example, a lot of work in healthcare systems involves the documentation of services. During audits, compliance officers should ask questions like: are our payors going to ask for more details, deny claims, pull back money, or request refunds if it’s not documented?   

Anywhere Compliance can insert our help and expertise in the revenue process is useful to the larger organization.  

The Biggest Dollar Value Uncovered in an Audit   

My best and worst example of a mock audit is one I conducted with a former employer. It was the seventh or eighth mock survey I’d done with them.   

We did audits quarterly and discovered something new every time. But this was the biggest dollar value I’ve ever uncovered in an audit.  

We were going through our usual process of doing chart reviews and looking for any issues with documentation. We asked questions such as: does the documentation equal your utilization review?   

In the Billing department, it came to light that a tremendous number of services hadn’t been billed. They had piled up quickly over several months because the team wasn’t able to keep up.   

The clinical services had been delivered by the treatment team. But they simply put them in the record and assumed they would get billed from there; they didn’t have a process in place to monitor and audit services.  

We asked why they hadn’t been billed, and we found that it was simply because the Billing department had not done it. We were in the midst of taking on new patients and adding new programs, and the invoices were overlooked.  

We didn’t have the right systems in place to question how long an invoice can go without being billed. Without that system, other issues came up that people turned their attention to; it happens every day in all our workplaces.  

The unbilled services totaled $9 million.  

At first, people were shocked and embarrassed. There was definitely some frustration. But once we got past the initial shock value, everyone was grateful that we caught it so we could address it and move forward.   

Transparency is Key   

My goal with audits is to normalize whatever happens, so that regardless of what we find no one needs to be defensive.   

Transparency from leadership is critical for successful audits. When the CEO gives Compliance free reign for an audit, it trickles down to all sites and operational areas.   

Transparency helps ensure that operational leaders don’t prevent auditors from looking at an area. It makes sure there’s teamwork and individuals’ commitment and cooperation for fixing any issues identified. It also creates a healthy culture where people aren’t penalized for audit results. In this situation, nobody got in trouble. The unbilled services certainly were not due to any one person’s fault or incompetence.   

More Checks and Balances  

We reacted, obviously, by taking care of the billing. The payor also came and did additional audits.   

After that, we looked at our processes and asked some more questions. How did this happen? Where did this communication fail?   

We learned our issue was just in one program at one location in one state. But the discovery made us pause and wonder if there were other issues in the rest of the system. We checked everywhere and didn’t uncover additional issues, but we still put corrective actions in place across the system. Now the system is built to catch issues before they happen.  

We established more controls and added more checks and balances. One was a monthly billing report to identify what was and wasn’t billed – and why – and what’s pending. It improved the communication and oversight of the billing area. Another addition was a monthly meeting to review whether anything was missed. Before, an assumption was made that everything was fine. The monthly meeting strengthened collaboration and partnership and made us look at ownership of issues.  

That’s one of the beauties of uncovering such opportunities: it pushed us to look everywhere to see what else we could improve.    

It was a lesson learned, and everyone rallied as a team to fix the issues. After we put new systems in place, there was a sense of pride in building them. And we built a lot of confidence that we weren’t missing anything.   

We made sure $9 million would be our biggest dollar amount ever uncovered in an audit and that the problems that led to it would never happen again.  

Five Benefits Beyond Revenue Protection   

By giving everyone the opportunity to step away from their day-to-day tasks and look at the bigger picture, mock audits offer benefits beyond revenue protection. Audits are opportunities for compliance officers to:   

1. Build relationships across the organization and shape culture. Audits demonstrate that Compliance is part of the team. I find that when we do audits quarterly, operational leaders reach out more. They’re asking me more questions or challenging more things because we’re in conversations all the time. 
2. Prevent fines. Mock surveys certainly minimize the risk, and they improve the likelihood that you are meeting all relevant regulations because you’ve had a chance to talk through issues and problem solve across operational areas.   
3. Prepare staff to be comfortable in an actual audit situation. I can ask staff tough questions, and then we can practice the right answers. I can coach staff on how to answer certain questions because sometimes individuals are afraid of regulators. The biggest findings in actual audits tend to happen when people get nervous in the moment, and they blurt out something that’s not accurate.  
4. Give everyone a chance to ask questions. Why is that relevant, or why are we doing this in two different places? I love these opportunities where we find something to correct or improve. My goal is always zero citations for any kind of regulatory visit, and we accomplish that by practicing with quarterly mock surveys.  
5.   Change the reputation of Compliance as the bad guy and position us as a true partner. When I’m on site for an audit and I find something to fix, I do it. When I handle it, I’m taking it off their plate – not just saying, “You guys go fix these things.” I remediate anything that I can control on a survey visit. It builds trust and helps operational leaders see me as a valued partner.    

If you don’t conduct mock audits, my recommendation is to start with something that feels manageable – even if it’s just once or twice a year. Quarterly is ideal for really solving issues. But start by picking a time and putting it on the calendar a year ahead so people can prepare for it.    

In my experience, it can take a couple surveys before operational leaders see the value in them. They may be resistant, thinking, “I have to spend three hours talking to my compliance officer when I’ve got work to do!”   

As they realize audits make their work better – and that I’m engaged with them in problem solving – it becomes a true partnership.  

My success in uncovering millions of dollars in unbilled services demonstrates how revenue protection is a tangible way Compliance delivers value to healthcare organizations. It also underscores how compliance professionals make an impact across the business through building relationships, shaping culture, preventing fines, and positioning Compliance as true partner. Integrating all these activities enables Compliance to help the organization better manage and control risk.  

Qualified compliance professionals do the heavy lifting for you, simplifying regulatory change management  

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The post Uncovering $9 Million in Unbilled Services    first appeared on YouCompli.

A physician practice in Texas paid $3.9 million. A major health system in California paid $13 million. A solo practitioner in Washington state paid $228,000. A physicians group in Florida paid $700,000. A medical group in Nevada paid over $2 million.  

What do all these entities and settlements have in common? The answer is urine drug testing (UDT). 

There has been significant enforcement over the last couple years relating to overpayments for UDT. This enforcement emphasis does not appear to be slowing down. 

What is Urine drug testing? 

UDT is laboratory testing of urine samples for the presence or amount of drugs in the urine. It is frequently performed on patients who might be at risk for substance abuse. This might include patients being treated for substance abuse or patients being treated for pain. 

In general, there are two major categories of UDT. The first is usually called qualitative or presumptive drug screening. This type of UDT detects the presence of a drug in the body. The second type is typically called quantitative or definitive drug testing. This might be performed when the results of initial screening are presumptively positive. Or it could be performed when the results of the screening are negative, and the negative finding is inconsistent with the patient’s medical history. Lastly, it might be used when there is no presumptive test available for that class of drug. 

The U.S. Department of Health and Human Services Office of Inspector General (OIG) has expressed concerns about UDT billing. According to the OIG, prior error rate testing has suggested an improper payment rate of almost 30% for Medicare. The overpayment rate for definitive drug testing for 22 or more drug classes was over 71%. The OIG’s work plan also highlights UDT as a future area of focus. 

Urine Drug Testing Enforcement Specifics 

The enforcement and settlement amounts highlighted at the beginning of this article share some common alleged non-compliant behaviors. These are summarized below: 

Medically Unnecessary 

The allegations frequently claimed UDT was not medically necessary. For example, the government regularly asserts Medicare claims must be “reasonable and necessary for the diagnosis or treatment of an illness or injury.” This language originates from the Social Security Act §1862 which outlines when a service can be paid by Medicare. 

In many of the cases it was alleged the definitive UDT was performed on the same day as presumptive UDT. The government argued that before ordering definitive UDT, a provider first needs to review the results of the presumptive test. Then, he or she can assess the individualized need before ordering definitive UDT. 

One red flag is the use of standing orders for definitive UDT. Some providers use the term “standing order” to mean routine orders for services delivered to a population of patients. In the example of UDT, providers might have a standing order to perform definitive UDT immediately after presumptive UDT. Medicare reimbursement guidelines require services to be medically necessary and the documentation needs to support the orders are individualized to each patient. Without the individualized decision making, Medicare will usually consider the service not eligible for payment. 

High Utilization 

Some of the physician practices developed in-house laboratories to perform the UDT. The government alleged the physician practices overutilized UDT. In one case, the government contended the clinic established protocols resulting in urine testing for an excessive number of metabolites. Reportedly, the clinic could not remain profitable without the income generated from such excessive testing.  

Faulty Equipment 

In some cases, the government alleged the laboratory equipment used to perform the UDT was faulty. For example, it alleged one clinic’s medical equipment for testing urine was broken. In this case, the samples were simply frozen for later testing. Some were never tested at all. 

Upcoding 

In some of the UDT settlement cases, the government alleged upcoding. Upcoding is when a provider assigns an inaccurate billing code to a medical procedure or treatment to increase reimbursement. In other words, a medical code for higher reimbursed UDT procedures were billed when using a lowered reimbursed code was more appropriate.  

Expect a continued focus on UDT

The enforcement focus on UDT does not appear to be going away. In February 2023, the OIG released an audit report about UDT. The report concluded Medicare could have saved up to $216 million over five years if it had implemented safeguards for definitive UDT. The report recommended Medicare do the following four things to prevent improper payment for UDT.  

1. Expand program safeguards to prevent and detect at-risk payments to at-risk providers for procedure code G0483. 
2. Review at-risk payments made to at-risk providers during and after the OIG’s audit period and recover any overpayments.
3. Notify providers to exercise reasonable diligence to identify, report, and return any overpayments. 
4. Educate providers who received payments that did not comply with Medicare requirements.

Armed with this knowledge of the government’s interest in UDT overpayments, Compliance professionals should consider taking the following steps: 

• Identify existing standing orders for UDT. If standing orders remove conscientious medical decision making by physicians for individualized patients, UDT services could be suspect. 
• Perform coding and medical documentation reviews for UDT services.  
• Engage compliance experts with clinical expertise to determine if UDT services meet Medicare’s medical necessity requirements. 

For many years now, the government has scrutinized providers over their UDT billing. In many cases, providers have paid millions of dollars to resolve improper billing allegations. Common allegations include medically unnecessary services, overutilization, faulty equipment, and upcoding.  

Enforcement agencies like the OIG are not slowing down their investigative efforts. In fact, they just released a report with recommendations for Medicare. The recommendations include detecting at-risk providers. Once identified, Medicare should perform audits on those providers. When overpayments are detected, Medicare should recoup the overpayments. Compliance officers can protect their organization by identifying UDT standing orders, performing medical documentation reviews, and involving compliance experts with clinical knowledge.

Related: A million-dollar healthcare compliance monitoring mistake: Don’t let processes overwhelm clinical colleagues

Verifying Regulatory Changes with YouCompli

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CJ Wolf, MD, M.Ed is a healthcare compliance professional with over 22 years of experience in healthcare economics, revenue cycle, coding, billing, and healthcare compliance. He has worked for Intermountain Healthcare, the University of Texas MD Anderson Cancer Center, the University of Texas System, an international medical device company and a healthcare compliance software start up. Currently, Dr. Wolf teaches and provides private healthcare compliance and coding consulting services as well as training. He is a graduate of the University of Illinois at Chicago College of Medicine, earned a masters in education from the University of Texas at Brownsville and was magna cum laude as an undergraduate at Brigham Young University in Provo, UT. In addition to his educational background, Dr. Wolf holds current certifications in medical coding and billing (CPC, COC) and healthcare compliance, ethics, privacy and research (CHC, CCEP, CHPC, CHRC).

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