TPE Audits Are Back:  What Providers Need to Know

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The Centers for Medicare and Medicaid Services (CMS) announced that Targeted Probe and Educate (TPE) audits would resume on September 1, 2021. TPE audits had been suspended by CMS during the public health emergency.  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.

Who conducts the TPE?  Medicare Administrative Contractors (MACs) conduct the TPE audits. 

Why is CMS utilizing TPE audit?  CMS promotes the TPE audit program by stating that it has increased provider education which results in decreased error rates and appeals through the CMS administrative appeal process. 

What can be reviewed?  While originally limited in scope to hospital inpatient admissions and home health claims, CMS expanded the program to allow MACs to perform TPE audits of all Medicare providers for all items and services billed to Medicare. 

Why are providers chosen?  Providers are usually chosen based on data analysis, such as high error rates in their billing practices in their submission of claims to the MACs or because they are outliers in their code utilization rates compared to their peers. However, providers can also be chosen for reasons unrelated to their own billing practices if they bill for items that have high error rates nationally.  CMS states that from October 2018 to September 2019, approximately 13,500 providers received a TPE notice of review and approximately 435,000 claims were reviewed. 

What is the TPE audit process? 

1. Provider receives a “Notice of Review” letter from the MAC which states the reasons the provider has been selected for review and requests 20-40 records be produced. 
2. Once the records are produced, the MAC will review the 20-40 claims against the supporting medical records and send the provider a letter detailing the results of their review. 
3. 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.

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 be requested with dates of service no earlier than 45 days after the one-on-one education. 

4. The provider will be given three rounds of TPE to pass. If the provider fails pass after three rounds, they will be referred to CMS for further action.  The next steps can include actions such as 100 percent prepay review, extrapolation, referral to a Recovery Auditor, or other action.  

How does the MAC decide if you are pass a TPE round?  The MAC can look at the Medicare Fee-For-Service improper payment rate for the specific item or service being reviewed and compare that to the provider’s error rate. The provider’s active participation in the education process and levels of improvement with each round are also taken into consideration. 

What are common mistakes identified in TPE audits? 

The most common errors identified by CMS are as follows:  

• The signature of the certifying physician is missing
• The encounter notes do not support medical necessity
• The documentation does not support medical necessity
• Missing or incomplete certifications or recertification documents 

What can a provider do to prepare for a TPE audit?  If you are a provider that has received a TPE audit, the best defense begins immediately prior to sending the requested records. By sending complete and organized records during the first round of a TPE, the chances of passing are increased. 

In addition, implementing corrections efficiently and effectively after education is given to the provider also increases the chance of passing the TPE audit. A well-developed initial response to a TPE audit can make the difference between passing the audit or being referred to CMS for further action.  As the next steps can include onerous actions such as 100 percent prepay review, extrapolation, referral to a Recovery Auditor, or other action, a carefully crafted response to a TPE audit is critical.  

Let us know if Nexsen Pruet can help guide you through this process.

_{This is an article from a series on Effectively Responding to Payor Audits & Program Integrity Investigations.  Topics in this series include practical advice and legal developments for providers defending payor audits and investigations, plus articles concerning current audit and investigation targets and the various types of auditors reviewing claims and conducting investigations.  The Series covers topics of interest to all providers of health care services, including hospitals, hospices, home health agencies, skilled nursing facilities, DME suppliers, clinical laboratories, pharmacies, FQHCs, RHCs, ASCs, community mental health centers, physicians, therapists, and other health care facilities, entities, practitioners, and clinicians.}