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Billing Audit Process

The healthcare billing audit process is an organized procedure that reviews and examines medical data/documents to ensure accuracy. A medical billing audit investigates the effectiveness and reliability of medical documentation of a provider’s practices. The process includes thorough check-ups of all health records and the billing data submitted by the payors.

What is a Billing Audit Process?

A medical billing process is all about combing through all present data and records for monitoring, identifying, and correcting inaccurate, incomplete, and inappropriate billing practices. Healthcare billing audits identify compliance issues that can impact the bottom lines or even land your practice in penalties with Medicare if you are credentialed.

Importance of Medical Billing Audit for Your Practice

Audits hold high significance in the success of your practice. Medical audits pinpoint areas where you need to improve your services or procedures as a healthcare provider. Furthermore, a healthcare billing audit helps with efficient and accurate documentation of medical records.

But how do we ensure healthcare compliance for medical billing audit? – Checkout our:

Billing Audit Process Checklist

To make sure that you stay on top of your healthcare billing audit, follow our checklist below:


  • First, define the scope of your billing audit and the resources, including the staffing needed for execution.
  • Designate the task to a team member, or even better, go for third-party consultation services for conducting the audit.
  • Factor in your audit tactics, and select several charts per provider and payer to review the data versus what is filled out.
  • Now, write it all down and circulate a complete audit plan among your team.

It is still a challenge to prevent coding and billing errors even after instilling extensive knowledge of provider’s services, and its linked diagnosis.


  • Secondly, review all your billing reports to categorize all risk areas and troubling trends. Include a comparison of irregularities with past performances.  
  • Compare the frequency of your physician services with that of your peers for a set period. It can also include the running of E&M frequency reports.
  • Now factor in a report detailing how your CPT codes are reimbursed.  


  • After getting hold of the above information, it’s time to set targets for improvement.
  • Now, it is time to make concentrated efforts and persuade payers to pay for their contracted rates, and that too in an accurate and timely manner.
  • For the billing process, you must follow up as much as necessary and devise a plan for dealing with the delinquent payers.
  • Now, moving on to address any internal problems identified by the billing audit. It can include the implementation of more training for your providers and staff.


  • As a healthcare practice, you should make billing audits a common occurrence.
  • Incorporate processes into your billing procedures to make your practice audits easier. These can include running frequent reports and monitoring net collections.

Advantages of Billing Audit Process

One doesn’t need a specific motivation or an outright reason for conducting a billing audit. Maintaining continuous billing audits is suitable for every facet of your practice.

Let’s look into some of the benefits of billing audits for your practice:

  1. Carrying out billing audits can boost your practice’s profitability.
  2. Audits can also serve as a perfect method that can help you locate incomplete, inaccurate, or even inappropriate billing practices that can cost you a lot of money.
  3. Unrecorded or unnecessary charges for services or items provider to patients can be identified via a billing audit on the medical record documentation.
  4. The billing audit process also helps coding staff by offering them ways to find, correct, and understand problems even before being identified by the insurer/payor or the government in the context of inappropriate coding.  
  5. The billing audit process also improves the medical record documentation of your practice. The improved documentation increases the payments for the services rendered, resulting in the first benefit.
  6. The billing audit process as a whole sets a standard that can be followed by admin staff, helping them avoid frustrations and stress in the future.
  7. Another advantage of following the billing audit process is protection from fraudulent claims and compliance issues.
  8. Billing audits become a necessity when you are providing services through Medicare.
  9. In addition to assisting your healthcare practice in increasing its overall profit, the billing audits also help you avoid a range of fees for Medicare reporting mistakes.
  10. Healthcare audits also help verify ICD-10-CM and EHR’s (electronic health record) readiness and meaningful use.

Final Thoughts

A consistent and systematic billing audit process can help medical practices at various levels. An expert team must be dedicated to your practice to avoid drawbacks and improve the overall RCM.

One effective way to decrease the probability of triggering a coding or billing audit and boosting your revenue cycle management is to contract or outsource your medical billing audit services. A third-party billing audit company like Physicians Revenue Group, Inc., with the following attributes:

  • Right Resources
  • Detail Practice Management Knowledge
  • Operational Capacity
  • Targeted billing audit tool

-all combined can manage all your claims and assist you in identifying audit-inducing issues even before they arise.

Frequently Asked Questions

A healthcare billing audit process is an organized procedure examining and reviewing data/medical documentation to ensure accuracy.

A coding audit is an internal/external review of a healthcare facility’s coding practices. It is done by reviewing patient medical and treatment records.
Billing audits help identify the areas you need to improve in your healthcare practice. It also helps with efficient and accurate medical records documentation.