Ask the payment expert ... about Medicare audit guidelines

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Ask the payment expert ... about the observation stay loophole
Ask the payment expert ... about the observation stay loophole

What guidelines should we use for a Medicare audit?

You should use the Office of the Inspector General's Provider Self-Disclosure Protocol updated on April 17, 2013. 

The sample size that is recommended is 100. We recommend you start with a probe sample of up to 50 claims and then calculate your error rate. If your error rate is 5% or below, you probably don't need to go any further. You will need to correct any system issue and you should probably do this process on an annual basis. 

If you have multiple facilities, you can spread these 50 claims across all the facilities. If you have an error rate greater than 5%, then you will want to expand your sample. 

According to the OIG guidelines, “the disclosing party may select an appropriate sample size to estimate damages as long as the sample size is at least 100 items.” The OIG strongly recommends the use of OIG's Statistical Sampling Software, also known as ‘‘RAT-STATS,'' which is currently available free of charge at 

It is smart to utilize these guidelines so that if you are ever scrutinized, you can show that you have been self-auditing and your results can be used to show you are in compliance. It also will show auditors that you understand the protocols and are completing your own due diligence to make sure you are in compliance. Use this process as part of your corporate compliance program. 

You can find more information on this program and the OIG's other recommended processes at  

Make sure you use competent people to audit your claims. Keep the names and titles of the individuals who conducted the review.