What a billing audit actually looks at

“Billing audit” sounds bigger than it is. Ours takes five business days and produces one page. Here’s what goes into that page and why.

Denials

The first thing we pull is every denied claim for the period, with its reason code. Payers attach a standard code to each denial that says why it was rejected. On its own, one denial tells you very little. A few months of them, grouped by reason and by payer, tell you where the process is breaking.

We look at three things:

• The denial rate. Denied claims as a share of claims submitted. This is the single number most practice owners have never seen for their own practice.
• The top reasons. Sorted by count. In behavioral health the same handful of reasons come up again and again: timing on therapy codes, add-on codes sent without the base visit, expired authorizations, enrollment gaps for newer clinicians, telehealth modifiers.
• The payers. One payer denying at a much higher rate than the rest usually means a rule that payer applies and the practice isn’t following.

Accounts receivable

The second thing we pull is the A/R aging report, by payer. This shows every claim that has been billed and not yet paid, sorted by how long it has been waiting. We wrote a separate post on how to read that report.

What we’re looking for:

• Old balances. Claims sitting in the oldest buckets that nobody has followed up on. Some of these are still collectible. Some are already past the payer’s filing deadline and never will be.
• Concentration. One payer holding most of the old balance.
• Credits and unapplied cash. Negative balances and payments that were received but never matched to a claim. These distort the totals and hide real problems.

Where the money is

Denials and A/R are two views of the same question: what did the practice earn that it hasn’t been paid for, and why? The one-page summary answers that in plain terms. Your denial rate. The top reasons. Where revenue is leaking. Nothing else.

What we don’t do in an audit

The audit is read-only. We don’t change anything in your system, and nothing is stored on our side. Read access under a Business Associate Agreement, five business days, one page.

What happens with the page

If the page shows the billing is in good shape, you get a fix-it list your current biller can apply, and that’s the end of it. If it shows real problems, we offer to take over the billing for a share of net collections. The pricing page has the number. Either way you keep the page.

If you want to do this yourself

You can. Pull the denial report and the A/R aging report from your practice-management system for the last few months. Group denials by reason and by payer. Look at the oldest A/R bucket by payer. If you can get those two views on a screen, you’ve done most of the work. The part that takes experience is knowing which of the reasons are a process problem and which are a payer problem, and what to change first.