Targeted Probe-and-Educate (TPE) audits resumed on Sept. 1.
Everyone in the industry knows about audits of healthcare providers. But what about the billing companies? Or a data-analytics company?
In a complaint filed last week, a New York data-mining company, DxID, was accused of allegedly helping a Medicare Advantage (MA) program game federal billing regulations in a way that enabled the plan to overcharge for patient treatment.
As you likely know, MA plans are paid more for sicker patients. Supposedly, DxID combed medical records for “missed” diagnoses (for example, adding “major depression” to an otherwise happy consumer).
A quick aside: a few years ago, I won an injunction for a provider that relied completely on a billing company to bill. Because this company aggressively upcoded, we used the victims’ rights statutes in the Social Security Act (SSA) to defend the provider. And it worked. Providers often forget about the safety net found in such statutes, if they wholly rely on a billing company.
This DxID complaint cites medical conditions it says either were exaggerated or weren’t supported by the medical records, such as billing for treating allegedly unsupported claims for renal failure, the most severe form of chronic kidney disease. The U.S. Department of Justice (DOJ) is seeking treble damages in the False Claims Act suit, plus an unspecified civil penalty for each violation of the law.
Medicare Advantage has been the target of multiple government investigations, DOJ and whistleblower lawsuits, and Medicare audits. One 2020 report estimated that improper payments to the plans topped $16 billion the previous year. In July, the DOJ consolidated six such cases against Kaiser Permanente health plans. In August, California-based Sutter Health agreed to pay $90 million to settle a similar fraud case. Previous settlements have totaled more than $300 million.
Some breaking news: Targeted Probe-and-Educate (TPE) audits resumed on Sept. 1. Due to COVID, TPE audits had been suspended. Unlike recovery audits, the stated goal of TPE audits is to help providers reduce claim denials and appeals, with one-on-one education focused on the documentation and coding of the services they provide. TPE audits are conducted by Medicare Administrative Contractors (MACs). While originally limited in scope to hospital inpatient admissions and home health claims, the Centers for Medicare & Medicaid Services (CMS) expanded the program to allow MACs to perform TPE audits of all Medicare providers for all items and services billed to Medicare.
Beware these TPE audits; they are not as friendly as they purport to be. A TPE audit can result in a 100-percent prepay review, extrapolation, referral to a Recovery Auditor, or other action, so a carefully crafted response to a TPE audit is critical.
The TPE audit process begins when a provider receives a “notice of review” letter from the MAC, which states the reasons the provider has been selected for review and asks that 20-40 records be produced. Once the records are produced, the MAC will review the 0claims against the supporting medical records and send the provider a letter detailing the results of their review.
If the claims are found to be compliant, the TPE audit ends and the provider cannot be selected for review again for a year, unless the MAC detects significant changes in provider billing. However, if the claims are found not to be compliant, the MAC will invite the provider to a one-on-one education session specific to the provider’s documentation and coding practices. The provider is then given 45 days to make changes, and a second round of 20-40 records will then be requested, with dates of service no earlier than 45 days after the one-on-one education.
The provider will be given three rounds of TPE to pass. Do not use all three rounds; get it right the first time. If the provider fails after three rounds, they will be referred to CMS for further action.
With MA, TPE, and audits of data-analytics companies ramping up, 2022 is going to bring an audit frenzy.
Programming Note: Listen to the RAC Report with Knicole Emanuel every Monday on Monitor Mondays, 10 Eastern.
For most of modern healthcare, the medical record was passive. It waited.It stored information. It was interpreted later by coders, clinicaldocumentation integrity (CDI) professionals, auditors,
One of my favorite resources is Insights, distributed by Kodiak. Let me begin by noting that I do not have any affiliation with Kodiak. I
Please log in to your account to comment on this article.
Uncover essential coding insights with nationally recognized coding authority Kay Piper, RHIA, CDIP, CCS. Through ICD10monitor’s interactive, on‑demand webcast series, Kay walks you through the AHA’s 2026 ICD‑10‑CM/PCS Quarterly Coding Clinics, translating each update into practical, easy‑to‑apply guidance designed to sharpen precision, ensure compliance, and strengthen day‑to‑day decision‑making. Available shortly after each official release.
Uncover critical guidance on the ICD-10-CM/PCS code updates. Kay Piper reviews and explains ICD-10-CM/PCS coding guidelines in the AHA’s fourth quarter 2026 ICD-10-CM/PCS Coding Clinic in an easy to access on-demand webcast.
Uncover critical guidance on the ICD-10-CM/PCS code updates. Kay Piper reviews and explains ICD-10-CM/PCS coding guidelines in the AHA’s third quarter 2026 ICD-10-CM/PCS Coding Clinic in an easy to access on-demand webcast.
Uncover critical guidance on the ICD-10-CM/PCS code updates. Kay Piper reviews and explains ICD-10-CM/PCS coding guidelines in the AHA’s second quarter 2026 ICD-10-CM/PCS Coding Clinic in an easy to access on-demand webcast.
Federal auditors are intensifying their focus on inpatient psychiatric facilities, using advanced data analytics to spotlight outliers and pursue high‑dollar repayments. In this high‑impact webcast, Michael Calahan, PA, MBA, Compliance Officer and V.P., Hospital & Physician Compliance, breaks down what regulators are really targeting in IPF-PPS admissions, documentation, treatment and discharge planning. Attendees will learn practical steps to tighten processes, avoid common audit triggers and protect reimbursement and reduce the risk of multimillion-dollar repayment demands.
In this timely session, Stacey Shillito, CDIP, CPMA, CCS, CCS-P, CPEDC, COPC, breaks down the complexities of Medical Decision Making (MDM) documentation so providers can confidently capture the true complexity of their care. Attendees will learn practical, efficient strategies to ensure documentation aligns with current E/M guidelines, supports accurate coding, and reduces audit risk, all without adding to charting time.
Join Ronald Hirsch, MD, FACP, CHCQM for The PEPPER Returns – Risk and Opportunity at Your Fingertips, a practical webcast that demystifies the PEPPER and shows you how to turn complex claims data into actionable insights. Dr. Hirsch will explain how to interpret key measures, identify compliance risks, uncover missed revenue opportunities, and understand new updates in the PEPPER, all to help your organization stay ahead of audits and use this powerful data proactively.
Stay ahead of the 2026-2027 audit surge with “Top 10 Audit Targets for 2026-2027 for Hospitals & Physicians: Protect Your Revenue,” a high-impact webcast led by Michael Calahan, PA, MBA. This concise session gives hospitals and physicians clear insight into the most likely federal audit targets, such as E/M services, split/shared and critical care, observation and admissions, device credits, and Two-Midnight Rule changes, and shows how to tighten documentation, coding, and internal processes to reduce denials, recoupments, and penalties. Attendees walk away with practical best practices to protect revenue, strengthen compliance, and better prepare their teams for inevitable audits.
Happy National Doctor’s Day! Learn how to get a complimentary webcast on ‘Decoding Social Admissions’ as a token of our heartfelt appreciation! Click here to learn more →
BLOOM INTO SAVINGS! Get 25% OFF during our spring sale through March 27. Use code SPRING26 at checkout to claim this offer.
CYBER WEEK IS HERE! Don’t miss your chance to get 20% off now until Dec. 1 with code CYBER25
CYBER WEEK IS HERE! Don’t miss your chance to get 20% off now until Dec. 2 with code CYBER24
