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Cultivating Homegrown Inpatient Auditors

By training coders who already are on staff, hospitals leverage institutional knowledge and build career paths.

Changes in payment policies, laws, and regulatory oversight are forcing healthcare organizations to respond to increased regulatory scrutiny and audits. Medicare audits have increased by 936 percent in the past five years*. Ad hoc inpatient audits are no longer enough of a defensive strategy. Robust internal auditing programs are becoming a must for inpatient organizations.

Building a team of internal inpatient auditors empowers revenue cycle leaders to proactively validate coding, determine compliance with regulations, and analyze clinical documentation. How can revenue cycle leaders staff this highly technical team? The best candidate pool for internal inpatient auditors is already within hospitals and health systems. By training the coders who already are on staff, hospitals leverage institutional knowledge and build a secure career path for internal talent. However, not all coders make great auditors. Here are the skills and qualities to look for as you consider which coders should advance into the internal inpatient auditing role.

What Makes a Good Inpatient Auditor?

Inpatient auditing is the next step in an inpatient coders’ career. Determining whether coders have the right skills requires understanding the demands of the job.

Internal Inpatient Auditor Roles
Internal Inpatient Auditor Roles

Coder. Coding is the foundation for inpatient auditing. As such, candidates must excel in coding, particularly in ICD-10. They should meet or exceed their organizations’ quality and productivity standards. In addition, the majority of healthcare hiring managers recommend that candidates have a minimum of three years of experience in acute inpatient coding before transitioning to auditor positions. For otherwise qualified candidates who need to boost their coding acumen, revenue cycle leaders can provide additional ICD-10 and PCS education.

Investigator. Auditors serve as investigators. They review supporting documentation and clinical results to confirm accurate code and DRG assignments. Simultaneously, they validate assignment of present on admission indicators for all diagnoses and look for missing information.

Problem solver. Auditors are problem solvers. When conducting audits, they identify and classify various problems and recommend appropriate solutions. Auditors make recommendations regarding education and training to resolve problems and shortcomings they uncover during audits. Auditors also may discover incomplete documentation while conducting audits and can make recommendations for clinical documentation improvement.

Appraisers. Auditors act as appraisers, using their knowledge of healthcare law, coding guidelines, compliance regulations, and documentation requirements.

Analyzer. Inpatient auditors move to fulfill the role of data analyzer. Once inpatient auditors have completed audits on statistically significant numbers of records, they view the results of audits at a high level, look for patterns, and identify coding and documentation improvement opportunities. This requires analytical skills, working knowledge of the financial impact of any changes recommended because of the audit, and the use of calculations and tools to create tables and formulas.

Communicator. Auditors communicate audit results and recommendations. Determining the skills needed for this communicator role will depend on a hospital’s auditor responsibilities. Some organizations only have their auditors report findings to their supervisors and coders, while others have auditors prepare reports that will be edited and presented to directors and C-level team members.

What Questions Should You Ask?

Identifying ideal candidates for auditing positions is not as straightforward as you may think. Aside from the obvious need to have credentials in health information management and coding, successful auditors possess other skills. Revenue cycle leaders should cover the following points during auditor interviews.

Coding accuracy. What are the candidate’s coding accuracy rates? Qualified candidates should have both high accuracy and productivity. Using a tool to test coding skills and guidelines is recommended to ensure all candidates receive equal assessment.

Knowledge base. Does the candidate have a good grasp of the official coding guidelines? Ask about knowledge and experience, including the American Hospital Association’s Coding Clinic publications.

Communication skills. Can the candidate convey a written and verbal message clearly and concisely? Would you feel confident asking the candidate to present audit findings? One way to assess this is to have the candidate read a paragraph or document and then summarize relevant information in three to five bullet points.

Maturity. Can the coder remain fair and objective when auditing the work of former colleagues? Ask the candidate to provide at least one experience in which he or she exercised conflict management skills.

Technical skills. Does the candidate have the technical skills to get the job done? Ask the candidate to audit at least 10 randomly selected records, summarize the findings, and verbally present the results to the interview team, including the director of health information management and the coding manager. Keep in mind that not all good coders make good auditors. Analytical thinking and investigative abilities are critical to auditing success.

Tips for Transitioning Coders

Transforming coders into auditors will require additional training and education. Whether hospitals develop their educational programs in-house or purchase online programs, curriculum should cover specific hard and soft skills needed to succeed.

First, begin training with refresher courses that ensure foundational skills such as coding and compliance. At the core of transition plans should be audit education, including hands-on training that instructs coders on what to look for during audits and where to find it; how to capture audit findings; how to objectively analyze findings; and how to synthesize findings into meaningful, actionable recommendations.

Training also should prepare auditors for the roles they will fill beyond the hard skills of coding and auditing. These vital soft skills include communication, problem-solving, decision-making, critical thinking, analytical thinking, and high-level thinking skills. In addition, make sure auditors have the integrity to perform objective audits of previous coworkers’ work.

Although coders may excel at using the software they currently use on the job, they may need additional software training such as the Microsoft Office suite. Audit results are generally captured with an audit worksheet that is likely an Excel spreadsheet.

Furthermore, PowerPoint training may be useful for communicating the results of audits to various levels of management throughout the organization.

Lastly, auditors will need to learn conflict management skills, especially if they are expected to present findings to previous co-workers. The ability to listen and act objectively will be critical.

These new skills and roles provide an exciting next step for an experienced, inpatient coder. When the right coder is prepared with the correct knowledge and skill set, both the individual and the organization will experience success.

Want to learn more?

Watch our complimentary, on-demand webcast, How to Cultivate an Inpatient Auditing Team and Ensure You Have the Right Professionals. 



Laurie A. McBrierty, MLT, ASCP, 
is vice president of product management at Panacea.

Dee Lang, RHIT, CCDS, 
is a health information management and technology consultant with Dee-L & Associates.

*Roche, E.M., PhD, JD, “ Medicare Audits: DRG Downcoding in Hospitals: Algorithms Substituting for Medical Judgment Part I,” RACmonitor, Sept. 14, 2016.