The Importance of Retina Practices Performing Internal and External Medical Record Chart Audits

CMS Compliance

Audit

Feb 4, 2025

Apr 3, 2025

Written By Elizabeth Cifers

Written By

Running a successful retina practice is about more than providing excellent patient care—it’s also about maintaining accurate and compliant medical records. Whether you're a solo retina physician or part of a large retina practice, performing regular internal and external chart audits is crucial for ensuring accuracy, compliance, and financial stability.

Why Are Medical Record Chart Audits Important?

Medical record audits, internal and external, are essential for several reasons, including:

Compliance with Regulations: Healthcare is highly regulated. Entities like the Centers for Medicare & Medicaid Services (CMS) have an extensive set of rules and regulations that must be met. Regular audits help ensure your practice meets these standards, reducing the risk of costly penalties.
Revenue Integrity: Documentation errors can (and do) lead to claim denials and recoupments, creating cash flow issues. Conducting audits helps pinpoint these errors, allowing your retina practice to correct them and avoid revenue loss.
Staff Education: Audit findings provide valuable insights that can be used to educate physicians and staff on compliance requirements, documentation improvements, and best practices. Training sessions based on audit results can help prevent recurring errors and promote a culture of continuous improvement.

Internal vs. External Audits: What's the Difference?

While the difference between internal and external audits is relatively self-evident, understanding the rationale is key to a well-rounded compliance program strategy for your retina practice.

Internal Audits

Internal audits are conducted by your in-house team, such as your compliance team or billing staff. These audits are typically more frequent and can be tailored to focus on specific areas of concern within your practice. Some excellent benefits of internal audits include:

Proactive Identification of Issues: Regular internal audits allow your team to catch and correct errors before they become more significant problems.
Cost-Effective: Internal audits can be more budget-friendly than hiring external auditors since they utilize existing staff. It is essential to allocate enough time for the team to audit and accomplish their usual workload.
Customization: Depending on your retina practice's specific needs, you can focus on high-risk areas, such as documentation accuracy or appropriate modifier usage.

External Audits

Industry-specific consultants or third-party organizations, such as payers, can conduct external audits. These audits can focus on a specific code, modifier, or diagnosis. For example, consider CMS’s Targeted Probe and Educate (TPE) and Comprehensive Error Rate Testing (CERT) audits. Sometimes, the term ‘audit’ can be as simple as an additional documentation request (ADR) to review the chart documentation before or after the payer adjudicates the claim.

Compliance Assurance: Payers and regulatory bodies may conduct audits to ensure compliance with their policies and guidelines. While no one looks forward to an outside audit, these audits are becoming more frequent, especially for individual claims.

Financial Impact: Findings from payer audits can lead to reimbursement adjustments, recoupments, or penalties, making it essential to address potential compliance issues proactively through independent audits.

Payers may or may not have the same depth of retina-specific expertise, and their findings may sometimes lack accuracy or context. This is why conducting audits by industry-specific consultants beforehand is crucial to mitigate potential issues and discrepancies. While they may be less frequent, external audits by consultants provide several advantages:

Unbiased Assessment: Consultants with specialized industry expertise bring fresh eyes and can often identify issues internal staff might overlook due to familiarity.
Expert Knowledge: Industry-specific consultants are well-versed in the latest regulatory changes, payer requirements, and best practices tailored to your specialty, retina.
Objective Information: Engaging qualified consultants ensures you receive an impartial and thorough review of your documentation practices, leading to more effective improvements.
Reducing Issues with Payers and Government Audits: Knowledgeable consultants can conduct external chart audits to help identify potential red flags before they become serious. This proactive approach reduces the likelihood of problems during payer or government audits, ultimately protecting the practice's financial health.

How to Conduct an Effective Medical Record Chart Audit

Whether the audit is internal or external, following a structured process to maximize effectiveness is essential. Here are some steps to consider:

1. Select the Audit Scope: Decide whether you're focusing on specific services, such as the frequency of high-level office visits or diagnostic testing, or if a recent issue needs to be explored further.

2. Select a Sample: Choose a representative sample of charts to review. While a random sampling method is often the most effective, it is not always practical. For example, select a service date to audit 5-10 charts based on the audit scope. Repeat the process for each physician until all have been audited.

3. Review Documentation Accuracy: Examine the information objectively to ensure the patient's medical record documentation is complete, clear, and meets regulatory standards.

4. Evaluate Coding and Billing: Check for coding accuracy and compliance with insurance requirements. Many auditors use CMS guidelines since they are readily available.

5. Identify Trends and Areas for Improvement: Look for recurring issues that need attention and develop an action plan to address them.

6. Implement Corrective Actions: Train staff on the audit findings and make necessary policy adjustments. Include physicians in the training.

7. Monitor Progress: Regular follow-up audits help ensure improvements are sustained over time. Performing a small sample audit 6 months after training to see if the instruction was successful or if further education is necessary.

Conclusion

Performing internal and external medical record chart audits is essential to running a compliant and successful retina practice. Internal audits provide ongoing, cost-effective oversight, while external audits offer an objective, expert perspective. Together, they help safeguard against compliance issues being a surprise, improve documentation to support the care you provide, and protect your revenue stream. Making audits a routine part of your retina practice’s operations and compliance program, you’ll meet regulatory requirements and create a foundation for long-term success.

Investing in regular audits now can save your retina practice from costly errors and prevent damage to your reputation down the road. So, whether you're just getting started or looking to enhance your current audit processes, remember that proactive auditing is always wise!

Ready to talk about an audit? Schedule a free consultation with Elizabeth here.

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