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CODING & BILLING
involving healthcare benefits.
Extrapolation, another word for extortion?
A more disconcerting practice involves those payors who take advantage of a
minimum amount of innocent coding mistakes that their auditors find. Even
though findings are minimal, some payors will use misleading tactics to justify submittal of much larger refund requests than expected through "extrapolation." Many providers have been surprised to receive huge refund requests
by payors after an audit that does not correlate with the much smaller dollar
amounts of the minimal coding discrepancies reported by the auditor.
Extrapolation is an arbitrary and capricious refund methodology that relies
on an error rate percentage calculation of claim sampling, rather than actual
claim errors.
Basically, the payor calculates a percentage of claim or coding errors as
reported by auditors against all claims audited. They then take that percentage (though minimal) and apply it to a much larger claim volume and time
frame "as determined by the payor." Extrapolation signifies a presumed pattern of systemic overbilling rather than basing findings on actual claim errors.
The problem with extrapolation is it also fails to comply with certain rights
and payor compliance requirements as understood under governing laws.
How to defend yourself
Here are some ways to make sure you're not victimized by deceptive audit
practices.
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O U T PAT I E N T S U R G E R Y M A G A Z I N E O N L I N E | O C T O B E R 2012
