Payer Math Multiplies Recoupments
By Ellen Terry

1.25 surprise billing photo

When does $187 equal nearly $13,000? When a payer projects overpayments.

A weekly audio tip from the National Alliance of Medical Auditing Specialists (NAMAS) cites a case in which illegible signatures forced a practice to refund almost $13,000.  

According to the tip, a payer had reviewed 34 of the practice’s claim lines over seven months. Twenty passed muster, but the payer deemed 14 as overpaid because of “documentation not supporting services billed.” 

The overpayment total was $187.88 — but the payer then “projected” its review findings onto “the audited paid claims universe,” resulting in a $12,989.64 recoupment demand. 

The payer’s review didn’t focus on whether the services were medically necessary or appropriately documented in the chart, said the tip’s author, audit consultant Sean Weiss. “Instead, they focused on the legibility [of] the providers’ signatures and thus determined the documentation did not support the services billed,” he said.

“This story illustrates why practices need to be ever-vigilant about the completeness and integrity of their medical records,” said TMA Practice Consulting Director Heather Bettridge. “Although NAMAS was able to get relief for this practice from the steep projected refund, the practice still would have had to expend time and money to resolve the payer’s demand.”

How can you help ensure a payer review of your records will come out clean? 


  • To avoid problems with signatures, create a listing, or signature log, of your physicians’ and midlevel professionals’ signatures, and require a printed name directly under the signature for every chart note. Include your signature log when submitting requested documentation to an auditor, advises Mr. Weiss. “If you have a policy regarding provider signature and legibility and the use of a signature log, give that to the auditor as well,” he said.
  • Do not rely on diagnosis codes alone to support the need for labs and other services. If your rationale for ordering them is not easily inferred, add an explanation in the chart; the reviewer may not view the diagnosis the way you do. 
  • Avoid the hazards of “point-and-click documentation” in your electronic health record.
  • Conduct internal audits of your coding and documentation, which will help your practice avoid denied claims, as well as audit hassles.  


TMA’s practice consultants can teach you how to audit your own records, with tips and resources for avoiding errors. Or you can hire TMA Practice Consulting to perform an in-depth review of 10 percent of your patient records to identify deficiencies or areas of risk; or get a coding and documentation check-up that provides a glimpse into a physician’s coding techniques. For information, email[at]texmed[dot]org, or call (800) 523-8776.

Last Updated On

July 10, 2018

Originally Published On

July 10, 2018

Ellen Terry

Project Manager, Client Services

(512) 370-1391

Ellen Terry has been writing, editing, and managing communication projects at TMA since 2000. She hails from Victoria, Texas; has a journalism degree from Texas State University; and loves to read great fiction. Ellen and her husband have two grown sons and a couple of cats.

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