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How to Prevent CMS Audits for Holistic Practices

holistic practice audits

Treating Medicare patients not only entails serving a greater population in your community, but it also means that your holistic practice may be subjected to Medicare audits. These can lead to suspension of payments and Medicare fees if your holistic practice isn’t up to snuff with current regulations and laws. 

Unfortunately, healthcare waste, fraud, and abuse lead the Centers for Medicare and Medicaid Services (CMS) to be diligent in recovering as much federal money as possible. Of course, there is no way to avoid facing a Medicare audit—sometimes they’re random. But there are ways to prepare for one to reduce any negative outcomes.

Which Holistic Modalities Does Medicare Cover?

While Medicare currently doesn’t fully cover the many services offered by holistic practices, there has been a significant push to include coverage for practices that manage and promote holistic wellbeing. 

For example, CMS recently introduced verbiage to cover acupuncture—with a few clauses related to back pain. According to Medicare, back pain can be covered if it meets the following conditions: 

  • It has lasted 12 weeks or longer
  • There is no known cause (not related to cancer that has spread, inflammatory, or infectious disease)
  • Pain not associated with surgery or pregnancy

Additionally, original Medicare pays for only one chiropractic service: manual manipulation of the spine if deemed medically necessary to correct a subluxation when one or more of the bones in your spine are out of position.

This procedure, when performed by a chiropractor or other qualified provider, is covered through Medicare Part B, the component of original Medicare that includes outpatient services; Medicare will pay 80% of the Medicare-approved rate for this procedure. 

Overall, Medicare won’t cover therapies unless deemed medically necessary. Regardless of coverage status through Medicare, many insurance companies follow the same policies. Staying up to date on these regulations and the consequences attached to them is important for your holistic practice to stay efficient and effective.

How Audits Impact Your Holistic Practice

By identifying errors and devising remedial actions to eliminate them, audits serve a vital role in a healthcare organization’s compliance plan.

Medical audits provide a mechanism to:

  • Review quality of care provided to patients
  • Defend against federal and payer audits, malpractice litigation, and health plan denials
  • Educate providers on documentation guidelines
  • Optimize revenue cycle management
  • Ensure appropriate revenue is captured
  • Determine if organizational policies are current and effective


What Are CMS Audits?

The goal of audits—in any industry or business—is to see how compliant that organization is with whatever set of rules and regulations is established and relevant. That’s essentially the same goal of audits conducted by CMS of holistic practices

These program audits measure compliance in terms of its contract with CMS, in particular, the requirements associated with access to medical or holistic services, drugs, and other enrollee protections required by Medicare.

The program areas for the 2021 audits include:

  • CDAG: Part D Coverage Determinations, Appeals, and Grievances
  • CPE: Compliance Program Effectiveness
  • FA: Part D Formulary and Benefit Administration
  • MMP- SARAG: Medicare-Medicaid Plan Service Authorization Requests, Appeals, and
  • Grievances
  • MMP- CCQIPE: Medicare-Medicaid Plan Care Coordination Quality Improvement Program
  • Effectiveness
  • ODAG: Part C Organization Determinations, Appeals, and Grievances
  • SNP-MOC: Special Needs Plans – Model of Care

What Is the CMS Program Audit Process?

There are four phases to a CMS audit:

  1. Audit Engagement and Universe Submission: Six weeks before fieldwork is conducted, an organization is notified that it has been selected for a program audit and is required to submit the requested data, which is outlined in the respective Program Audit Data Request document.
  2. Audit Field Work: Over the course of three weeks, program audit fieldwork is conducted, mostly via webinar with the exception of the CPE review, which may occur onsite during the last week. 
  3. Audit Reporting: Audit reporting occurs in multiple stages beginning at the conclusion of audit fieldwork. CMS first shares audit results with the holistic practice at the exit conference via the preliminary draft report, but the findings in a preliminary draft report are subject to additional review and evaluation after all supporting documentation has been received and evaluated, at which point classification occurs. 
  4. Audit Validation and Close-Out: This is the longest phase of the program audit process, taking approximately six months to complete. During validation and close-out, an organization has an opportunity to demonstrate to CMS that it has corrected the noncompliance that was identified during the program audit.

What Does CMS Look For in Audits?

By conducting audits, either at random or as suspicious activity is reported, CMS works to prevent, reduce, or address a holistic practice exploiting CMS money or information, regardless of intention. Such issues to address might include falsifying claims that are billed to Medicare, charging excessively for Medicare services or supplies, making false statements on applications to participate in federal programs, and more.

Part of this stems from CMS regulations updating from year to year, so paying attention to their regulations on a continuous basis is important to maintaining compliance.

How Much Will CMS Increase Audits in the Future?

CMS’s budget for fraud, waste, and abuse mitigation doubled from 2021 to 2022 as the agency sought a $50.5 million increase in funding for “conducting greater levels of review.” 

Medical review activities include pre- and post-payment audits and also encompass the Targeted Probe-and-Educate (TPE) process. CMS also requested additional funding for modeling and analytic tools aimed at identifying fraud, waste, and abuse.

The funding increase also allowed CMS to hire more administrative law judges (ALJs) in an attempt to reduce the backlog at the third level of Medicare provider appeals, which currently sits at five years

5 Tips to Avoid CMS Audits

avoid CMS audits

Perform a Self-Audit

Perform your own random mock audits based on the same criteria as a Medicare auditor to uncover what they would find and address any issues before they bring them to your attention. Visit the CMS website for the most up-to-date information on submitting claims that comply with Medicare guidelines.

Conducting internal audits at your holistic practice is important because it further ensures your practice is following all policies and procedures. Or, on the other hand, it points out areas of improvement for yourself and your team.

Prevent Billing and Coding Mistakes

Generally, Medicare pays claims based solely on your representations in the claims documents. Utilizing a standardized set of medical billing codes facilitates the billing process by bringing uniformity to the billing process. 

When the coding on the claim does not meet the Medicare requirements and Medicare pays the claim anyway, the audit may discover this mistake. That’s why it’s so important to submit accurate claims and ensure appropriate coding is employed.

Provide Accurate Documentation

Holistic organizations need to make sure that everything is documented, including data presented on meaningful use reports generated by EHR and all other evidence. Auditors will be looking for discrepancies along the practice’s decision-making process. 

By knowing the right procedures and eliminating errors with better technology, discrepancies can be kept to a minimum. Practices that have the appropriate documentation of every decision made—and each process change—will be able to easily find any potential trouble areas.

Review Every Process

Reviewing every process pertinent to the medical billing and patient information systems side of your holistic practice is important in preventing CMS audits. 

As medical billing and patient information systems become more integrated, the need to review every process becomes more critical since a simple change could require an organization to upgrade multiple other systems to be successful. This is a good habit to establish with your holistic practice, especially if the coding of a specific holistic procedure changes.

Train Your Staff

One of the most common reasons a healthcare organization fails an audit is due to human error. This is where a well-trained and experienced billing team can be considered the most important driver of revenue for holistic practices. Billers and coders who are credentialed and certified from the proper associations are less likely to make mistakes and understand how to properly manage these solutions.

A qualified and confident staff is also more likely to be aware of industry changes that impact operations and can implement changes to remain up-to-date. This kind of staff is also more likely to advance principles that can make a bigger difference in the revenue cycle.

Avoid CMS Audits with Holistic Billing Services!

Our experts here at Holistic Billing Services believe that our success is your success. From handling medical billing and coding to offering consulting services and much more, our team is dedicated to making it feel like we’re in-house. 

With a focus on holistic practices, insurance background, and proven consultants, our team can effectively ensure the financial success of clients, allowing your medical practice to focus on what it does best: treat patients.

Our expertise is rooted in professional, technical, and global billing for hospital and stand-alone holistic care practices. To learn more about how outsourced medical billing with Holistic Billing Services can empower your practice, contact us today. We’ll work with you to build a customized solution that meets the specific needs of your practice and allows you to get back to treating patients.

November 3, 2021
 - by Antonio Arias, MBA, CHBME
holistic practice audits
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