Healthcare Industry:  Optimize Your Systems, Processes and Approach to Mitigate Risk and Potential Fraud
Checklist

Healthcare Industry: Optimize Your Systems, Processes and Approach to Mitigate Risk and Potential Fraud

by Patrick Chylinski
October 21, 2021

Companies in the highly regulated, quickly changing, and competitive healthcare industry face a significant number of challenges that extend beyond the standard businesses challenges such as revenue growth and profitability.

Multi-layered and complex regulatory issues, a disparate payer structure, and the reimbursement process (the way in which healthcare providers are paid) are key areas of focus for healthcare companies. These can create difficulties and challenges, but at the same time and be opportunities for improvement, gaining efficiencies, and optimization.

In addition to the regulatory and reimbursement items referenced above, healthcare companies would be well served to look for ways to improve their systems, processes, and controls with a focus towards fraud and fraud mitigation. Occupational fraud (fraud perpetrated by executives or company employees), and fraud perpetrated by third parties (those outside the company, such as vendors), has a significant impact on companies.

In short, taking steps to optimize the reimbursement process by improving accuracy, completeness, and regulatory compliance, as well as improving policies, controls, and procedures to reduce and mitigate potential fraud can likely have a significant impact on an organization.

The following checklist can serve as a starting point for you to consider the potential areas and improvements your organization can make to optimize your operational and financial performance and mitigate financial fraud.

Systems and Record Keeping

Data systems (and the “technology stack”) can be an asset to your organization, or a liability if those systems haven’t kept up with the growth, complexity, and speed of your business and the industry. In assessing your systems, here are some items and questions to consider:

  • Have the following systems been thoroughly assessed (or when was the last time?) and updated to support your organization?
    • Finance
    • Accounting
    • Medical records
    • Billing

What worked in the past for your organization may no longer be sufficient. Are your systems on track to support your business needs both today and in the future?

  • Do your systems allow for accurate, comprehensive, and timely recording and reporting for the following key areas?
    • Claims and reimbursements
    • Vendor relationships and payments
    • Payroll
    • Expense reimbursements
    • Financial and tax reporting
    • Response to regulatory inquiries, audits and other informational requests

Consider how documents an files are stored and able to be accessed in the event you need to provide that documentation to support services provided, submissions, and the like.

Claims Submissions and Reimbursements

Your systems and technology stack can either enhance or impede efficient claims submissions and resulting reimbursements, which are the lifeblood of your healthcare organization. Key action items to consider as you evaluate both areas include:

  • Determining whether your current systems and technology stack effectively minimize claim adjustments, denials and unreimbursed items
  • Estimating the financial cost and resource cost (time spent reviewing data, responding to inquiries, making adjustments, etc.) of your claims systems
  • Assessing and monitoring the qualified staff currently in place and identifying any training opportunities
  • Performing quality control of billers and the billing process
  • Monitoring the claims systems in place
  • Closely examining billing and reimbursement reporting
  • Investigating reconciliations and suitability of write-offs and adjustments

Fraud and Fraud Risk Mitigation

As referenced previously, financial fraud can have a major impact on your organization. Whether from someone from the inside, or someone from the outside, putting systems and processes in place to prevent and mitigate fraud is a key consideration for protecting the organization.

Consider asking the following questions:

  • Do you have controls and processes in place to minimize occupational fraud? Occupational fraud may include:
    • Payroll fraud (ghost employees, overpayments, etc.)
    • Expense reimbursement
    • Billing schemes
    • Vendor-related schemes
  • Do you have controls in place to mitigate other fraud schemes? These may include:
    • Billing company-related issues
    • Kickbacks for referrals

Ultimately, a regular process of assessing current state, determining areas for enhancement, and moving forward and implementing those improvements are incredibly important.

For more information on strengthening your organization’s operational and financial health and minimizing potential fraud, contact our fraud investigation and forensic accounting experts.

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