How Often Should a Medical Practice Conduct a Compliance Audit?

A healthcare compliance audit systematically reviews a medical practice’s policies, procedures, records, and business activities to determine whether they meet applicable legal and regulatory requirements. Healthcare is one of the most regulated industries, and failing to comply with laws and regulations can have significant consequences. At the same time, the legal and regulatory landscape is constantly changing, making compliance even more difficult.

Regular compliance audits help healthcare organizations catch potential issues early and ensure they remain compliant. Knowing when audits are needed and what they should include helps healthcare organizations protect patients and avoid legal consequences. Here is what healthcare organizations should know about compliance audits.

What are the Main Steps of an Audit?

During the audit, auditors collect information to check whether the organization is meeting these requirements. They may review documents, examine patient records, interview employees, and observe how tasks are carried out. This helps them understand how the organization operates and identify any problems that need to be fixed.

Some of the main steps in a healthcare compliance audit include:

• Reviewing documents: Checking patient records, consent forms, company policies, and other key paperwork to ensure everything is accurate and up to date.
• Checking regulations: Making sure the organization follows healthcare laws and rules, including patient privacy and billing requirements.
• Talking to staff: Asking employees about their roles and making sure they understand the organization’s policies and procedures.
• Finding problems: Identifying mistakes, outdated policies, missing information, or practices that could lead to compliance issues.
• Writing an audit report: Summarizing findings, explaining what needs improvement, and suggesting ways to fix problems.

Does the Law Establish a Set Timeline for Audits?

No single timeline exists for healthcare compliance audits, as requirements vary by applicable laws, regulations, and audit type. Healthcare organizations should generally conduct compliance audits at least annually, with more frequent audits as needed based on identified risks, regulatory changes, or areas of concern. 

Organizations should stay informed about applicable requirements and regularly review their policies, procedures, and practices to catch potential issues early. Thoroughly documenting audits, findings, and corrective actions is also important, as these records can help demonstrate compliance during an investigation or regulatory review.

Frequently Asked Questions

Who should conduct a medical practice compliance audit?

A medical practice compliance audit should ideally be conducted by an independent outside professional or firm with specialized experience in healthcare regulations. External auditors offer an objective perspective and can identify compliance gaps that internal staff may overlook. Qualified auditors may include attorneys experienced in healthcare law. Look for expertise in HIPAA, billing regulations, documentation, and federal and state requirements, along with objective assessments and actionable recommendations.

What happens if a compliance audit identifies violations?

If a compliance audit uncovers violations, the first step is to identify what went wrong and how to fix it. Issues involving patient privacy, billing errors, or healthcare regulations should not be ignored, as they can lead to bigger problems if left unaddressed.

Here are a few steps a medical practice can take:

• Investigate the problem: Determine what happened, how serious it is, and whether other issues need attention.
• Fix what’s not working: Update policies, improve procedures, and train staff to avoid repeating the same mistakes.
• Keep clear records: Document the findings and the steps taken to correct them.
• Address billing errors: Review incorrect claims or overpayments and determine whether refunds or other action are needed.
• Get legal advice: A healthcare attorney can explain reporting requirements and help the practice understand its options.

What factors might increase the frequency of compliance audits?

There is no set timeline for when healthcare organizations should conduct compliance audits. However, certain aspects of a healthcare organization may require more frequent audits. 

• Healthcare regulations and payer requirements can change over time. A practice should review relevant policies when new requirements take effect or when changes affect its billing, privacy, prescribing, or other operations.
• Larger practices may have more employees, locations, billing activity, and contractual relationships to review. Their compliance programs may require more extensive monitoring than those of smaller practices.
• Specialty can also make a difference. Practices that perform complex procedures, prescribe controlled substances, or submit claims for specialized services may face compliance risks that warrant additional attention.

What healthcare laws should a compliance audit address?

A healthcare compliance audit should review the laws and regulations that apply to a medical practice’s daily operations, billing procedures, patient records, and staff responsibilities. The specific requirements depend on the practice’s size, specialty, location, and payer arrangements.

A good audit should at least cover: 

• HIPAA: Reviews how the practice protects patient health information, maintains confidentiality, and manages data security and breach reporting.
• False Claims Act: Examines billing practices to identify inaccurate claims, improper payments, or potential healthcare fraud.
• Stark Law: Evaluates physician referrals for designated health services involving entities with which physicians have certain financial relationships.
• Anti-Kickback Statute: Checks whether referral arrangements or financial incentives could violate federal prohibitions on improper remuneration.
• Medicare and Medicaid regulations: Reviews eligibility verification, coding, documentation, billing, and reimbursement procedures.
• OSHA requirements: Assesses workplace safety, employee training, and exposure-control practices.
• State healthcare laws: Identifies applicable licensing requirements, patient privacy protections, professional conduct rules, and mandatory reporting obligations.
• Employment laws: Reviews wage requirements, workplace policies, discrimination protections, and employee classification.

Contact an Experienced Healthcare Regulation Compliance Attorney 

A healthcare attorney can help a medical practice determine which laws and regulations apply to its operations and develop an audit schedule that reflects its specific risks. They can also review compliance policies, assess contractual and regulatory obligations, advise on potential violations, and help the practice respond to audit findings. By reviewing compliance regularly, addressing identified problems, and keeping policies current, medical practices can better manage legal risks and support responsible patient care. Contact us today to discuss.