The importance of having an external billing audit for your behavioral healthcare company.
Behavioral healthcare companies play an essential role in providing mental health services to individuals in need. These companies often rely on insurance payments and government reimbursement to keep their business running. However, billing for these services can be complex and time-consuming, and errors can occur, leading to financial losses and legal issues.
To ensure accurate and compliant billing practices, many behavioral healthcare companies opt to have an external billing audit performed. In this blog post, we’ll explore what an external billing audit is and why it’s important for behavioral healthcare companies.
What is an external billing audit?
An external billing audit is an independent review of a behavioral healthcare company’s billing practices and procedures by a third-party auditor. The auditor reviews the company’s billing records, policies, and procedures to identify errors, inconsistencies, and potential areas of noncompliance.
The audit may include a review of claims submitted to insurance companies, Medicaid, and Medicare to ensure that they are properly documented and billed correctly. The auditor may also evaluate the company’s financial records and internal controls to determine if they are adequate for accurate billing and reporting.
Why is an external billing audit important for behavioral healthcare companies?
- Ensure Compliance
Behavioral healthcare companies must comply with various laws and regulations, such as the Health Insurance Portability and Accountability Act (HIPAA) and the Affordable Care Act (ACA). Noncompliance can result in significant fines, legal penalties, and damage to the company’s reputation. An external billing audit can identify potential areas of noncompliance and help the company correct any issues before they become serious problems.
- Prevent Fraud and Abuse
Billing fraud and abuse can occur in any healthcare setting, and behavioral healthcare is no exception. An external billing audit can identify patterns of questionable billing practices and identify any potential fraud or abuse.
- Improve Revenue Cycle Management
An external billing audit can help identify areas where a behavioral healthcare company can improve its revenue cycle management. For example, the audit may reveal that the company is not correctly documenting services, leading to denied claims and lost revenue. By identifying these issues, the company can take steps to improve its revenue cycle management and increase its bottom line.
- Provide Assurance to Stakeholders
An external billing audit can provide assurance to stakeholders, such as investors, creditors, and regulatory agencies, that the behavioral healthcare company is operating in a compliant and financially sound manner. This can help the company maintain its reputation and credibility in the marketplace.
In summary, an external billing audit is an essential tool for behavioral healthcare companies to ensure accurate billing practices, prevent fraud and abuse, improve revenue cycle management, and provide assurance to stakeholders. By identifying potential areas of noncompliance and implementing corrective actions, companies can protect their financial interests and maintain their reputation in the marketplace.