BMI Audit Finding of the Month: Audit Finds Prior Authorization Not Provided Prior to Claims Payment

Audit Issue

The audited health plan required prior authorization for Durable Medical Equipment (DME) charges exceeding a stated amount.

Audit Finding

We used AUDiT iQ to select sample DME claims for on-site review.  While on-site at the Administrator’s payment location, we confirmed that prior authorization was not provided prior to processing several large DME claims.

TPA/Carrier Response

The claims administrator acknowledged that its systemic edits were programmed to trigger a prior-authorization request only for specific hard-coded HCPCS DME codes and had not been subject to periodic updating.

Financial Error

The administrator agreed to financial errors amounting to more than $13,500.00 for the three samples we reviewed.  They also agreed to thoroughly investigate past claims history to assess the total financial impact of similar errors.

Audit Finding of the M..., BMI Audit Services, durable medical equpment, prior authorizationRandy Light, Founder + Executive Advisor