Frier Levitt represents providers nationwide in Medicare, Medicaid, and commercial payor audits and appeals. We defend against overpayment demands, prevent recoupment, challenge flawed audit methodologies, and protect providers’ enrollment and reimbursement rights.
When a Medicare, Medicaid, or other commercial payor claim is denied or reopened for post-payment review, providers face a complex audit and appeals environment. These audits can range from educational directives to substantial overpayment demands – and in serious cases may lead to enforcement actions, civil or criminal liability, administrative penalties, or program exclusion.
While all payor audits must be taken seriously, Medicare audits are governed by a complex framework of laws, regulations, and policies that can create traps for the unwary. The key to successfully navigating this environment is preparation, knowledge, and experienced legal guidance.
Because CMS and other payors increasingly rely on data analytics to identify billing outliers and potential compliance risks, it is essential for providers to understand the full landscape of CMS audits, Medicare appeals, and related payor investigations.
The Medicare Appeals Process
Medicare appeals require precision and strict adherence to procedural rules. Each appeal stage has distinct documentation and timing requirements. Missing a filing deadline or failing to include supporting materials – such as medical records, attestations, or expert reports – can permanently bar the practice from relying on that evidence later in the process.
A miscalculated response deadline can forfeit appeal rights entirely, and a casual or incomplete approach to CMS appeals can have devastating financial and operational consequences for providers of any size.
Medicare Fraud, Waste, and Abuse Enforcement
Medicare fraud is a crime, and the penalties for abuse can be significant. Many providers mistakenly believe that using a third-party billing company shields them from responsibility. However, Medicare providers are ultimately accountable for the accuracy of all submitted claims.
The federal government employs multiple contractors to detect and investigate Medicare fraud, waste, and abuse, recover overpayments, and refer cases to enforcement agencies. Matters escalated to the HHS Office of Inspector General (OIG) or the Department of Justice (DOJ) can result in treble damages, civil monetary penalties, exclusion from federal programs, or even criminal prosecution.
Given the potential stakes, providers should always challenge audit findings and work with qualified healthcare audit counsel to protect their rights and financial interests.
Proven Experience and Results
Frier Levitt’s attorneys are highly skilled in the Medicare appeals process and the laws and rules governing coding, billing, and compliance for Medicare, Medicaid, and commercial payors.
Our team has successfully helped clients mitigate the impact of audits and clawbacks by:
- Reducing original audit error rates (in some cases by up to 90%)
- Recovering millions of dollars inappropriately recouped from clients
- Lowering overpayment demands by more than $100 million
In nearly every case, our experience confirms that auditors must be challenged — their findings are often subjective, flawed, and biased toward the auditing entity.
Types of CMS and Payor Audits
The Centers for Medicare & Medicaid Services (CMS) and its contractors employ several types of audits and reviews, including:
- Targeted Probe and Education (TPE)
- Supplemental Medical Review Contractor (SMRC)
- Unified Program Integrity Contractor (UPIC)
- Zone Program Integrity Contractor (ZPIC)
- Recovery Audit Contractor (RAC)
- Pre-payment review audits
- Post-payment audits (the most common)
These reviews typically focus on billing and coding compliance, medical necessities, and statistical outliers. Each regional CMS contractor also applies Local Coverage Determinations (LCDs) and National Coverage Determinations (NCDs) to guide coverage and documentation standards.
Common Focus Areas and Red Flags
Auditors frequently target:
- Billing and coding accuracy
- Adequacy of medical documentation
- Upcoding or under documentation
- Misapplication of LCDs or NCDs
- Statistical patterns suggesting overutilization
Failure to address these issues can lead to claim denials, recoupment of overpayments, or extrapolated repayment demands.
Risks and Consequences
Multiple adverse CMS or payor audit outcomes can trigger serious repercussions, including:
- Suspension of billing privileges
- Revocation of Medicare enrollment
- Civil money penalties or treble damages
- Exclusion from federal programs
- Referrals for criminal or civil enforcement
Even when billing is outsourced, providers remain legally responsible for compliance.
Preparing for an Audit
Preparation is the best defense. Key steps include:
- Engage experienced healthcare counsel early.
Legal guidance helps providers navigate the regulatory and procedural complexities of CMS and payor audits. - Conduct proactive internal audits.
Review billing, coding, and documentation practices to identify potential vulnerabilities before an external review occurs. - Organize documentation.
Maintain complete, contemporaneous medical records that clearly support the services billed. - Respond promptly.
Missing deadlines or submitting incomplete information can forfeit appeal rights.
How to Respond to Unfavorable Findings
If you receive a negative audit determination or overpayment demand:
- Review the auditor’s methodology for errors or improper extrapolation.
- Identify misapplied LCDs or NCDs.
- Develop a targeted defense strategy with counsel and expert input.
- File timely, well-supported appeals at each required level.
- Maintain consistent communication to preserve appeal rights.
Even findings with a 100% alleged error rate can often be reversed or significantly reduced with a strong, evidence-based appeal.
How Frier Levitt Can Help
If your practice has received a CMS audit, Medicare overpayment demand, or commercial payor audit, Frier Levitt can provide strategic, industry-focused legal counsel tailored to your needs. Contact our team today to learn how we can help you.
