Provider Resource Page on Audits and Recoupments


Proper documentation – Although, documentation may not be required for initial billing of services, providers should always completely document each patient encounter.  While billed services may be completely legitimate, the documentation is the only record of the encounter.  If the service is not documented at all or is inadequately documented, the auditor or investigator may deduce that the service was not provided appropriately.  Documentation is the only way to substantiate that the care you provided was actually performed.  For detailed information on documentation, please refer to ACA’s Clinical Documentation Manual, which can be purchased at the ACA online store.

The ACA also offers the Practice Resource Center, a web-based member benefit, which contains a number of modifiable forms that can be useful in the clinic setting.  To access ACA’s Practice Resource Center please visit: .

Proper Coding

When billing for the individual services rendered during each patient encounter, it is important to make sure that you are using CPT® codes that most accurately describe these services.  Before using a particular code, read the description of that code and make sure it most closely matches the actual services provided.   The ACA maintains the Coding Resource Center for members and it is searchable either by CPT® code or by keyword.  It can be accessed at:

 In addition, the ACA partners with ChiroCode to publish the DeskBook on an annual basis.  This manual contains the most commonly billed codes used by doctors of chiropractic, with in-depth descriptions, helpful tips and more.  The ChiroCode DeskBook can purchased at the ACA online store.

Additionally, on occasion, the ACA holds teleseminars on proper coding.  The ACA has two members who sit on the AMA CPT and RUC Committees and are intimately knowledgeable about code development and proper coding. 

Peer/Self Audits

Providers can best avoid audits and recoupments by performing self-audits.  Self-audits are an inexpensive way to double-check that services are properly documented and billed.  A self-audit can be performed at any interval.  Some practices prefer to self-audit daily before the services are billed, while others prefer to self-audit on a monthly, quarterly, semi-annual, or annual basis.  Audits can be performed on every chart for a particular date of service or randomly on a less frequent basis for proper coding, documentation and compliance with provider/ insurer contracts.  Providers are encouraged to use ACA resources such as those listed above for more information on what is appropriate.

Listed below are a few sample forms that can be used to self-audit:

Another area for self-audit is contract compliance.  This type of audit does not have to be done with any regular frequency, but can help providers avoid pitfalls specific to a particular insurer or network.  In this situation, all contracts that a provider has signed with a managed care organization should be reviewed in detail and provider practices should be analyzed to assure compliance with those contracts or the provider could choose to terminate the contract if they are unwilling to comply with the restrictions laid out in the contract.  It might be helpful for a provider to have an insurance manual in the office that contains all of the requirements for each contracted insurer.   It can also be helpful to access ACA’s resource for contract review found at Seeking the advice of a healthcare law attorney knowledgeable in the area of contract law is generally a wise step to take.

External Audit Requests

Once a practice receives an audit notification, generally they must comply with records requests based on the contractual agreement (provider contract) with the insurer. Providers who are out-of-network should be aware that in some states, it is possible that just cashing a reimbursement check is considered to be the equivalent to agreeing to the contract terms due to the insurance laws.  In the case of Medicare and Medicaid, it is part of the formal requirements of these programs to have to comply with requests for documentation. 

It should be noted that audits are triggered for varying reasons, such as:
• complaints received;
• claims patterns;
• advertising; and/or
• simply random audits.   
In many cases, audits are performed using extrapolation procedures.  In many cases, an insurer asks for a sampling of records, and then reviews them for errors.  At this point, the insurer identifies a percentage of error among the sample claims and then projects that error rate retrospectively over a specified period of time and requests refunds based on that percentage for all claims during that period of time.  For example, if a 30% error rate is determined, the insurer may demand a 30% refund for all patients covered by that insurer and treated by that provider going back 3 to 5 years. 

Some states have regulations and court decisions that protect providers in these situations.  Providers are encouraged to contact their state department of insurance to inquire as to whether any state statutes exist to address audits, extrapolation and recoupments.

State Recoupment Limitations

It should be noted that many states have statutes that regulate how far back and under what circumstances an insurer can recoup money for previously paid claims.   

Seek Guidance/Counsel

Once a request to refund monies for previously paid claims is received, providers are strongly encouraged to contact their malpractice carrier.  Many of the larger chiropractic malpractice carriers have audit and recoupment coverage, although the specific coverage may vary.  As mentioned above, providers are encouraged to consult legal counsel that is well versed not only in healthcare law, but that also with audits and recoupment requests. 

In certain circumstances, insurers may request a refund when in fact inaccurate information was given to the provider at the time of benefit verifications.  In Indiana, a decision by the Indiana Court of Appeals (St. Mary’s Medical Center, Inc. vs. United Farm Bureau Family Life Insurance Co., 624 N.E. 2d 939), stated that providers who can demonstrate that they were an innocent third party creditor, the refund was not requested due to any misrepresentations by the provider, and the provider acted in good faith and without prior knowledge of the insurer’s mistake, would not be held liable.  (It should be noted that this is most useful to those providers who have verified benefits prior to provision of services and the insurer made an error explaining the available benefits for an enrollee.)  Again, it would be prudent for the provider to check with their state department of insurance to determine if similar court decisions or regulations exist.

Important Note:  It is a necessary component that when a refund request has been received by a provider, as the result of a retrospective review or audit, that the refund request should describe the specific findings of the audit, including:
• the specific coding and/or documentation errors that were found;
• the percentage of sample charts that were found to have errors;
• the confidence level used in the report; and,
• the appropriate avenues for appealing the decision. 
The provider should then review the sample charts that were provided to the insurer which resulted in the recoupment request and determine whether the conclusions are supported by the documentation.  It may be prudent to retain an independent coding professional in the case of coding errors or seek another independent consultant to review the documentation for errors.

If the provider, independent consultants, and/or legal counsel determine that there are discrepancies in the insurer’s audit findings, providers are strongly encouraged to appeal the findings through the appropriate administrative procedures including the state’s process for external review.  Providers are also encouraged to contact their state and national chiropractic organizations and their state department of insurance for assistance.  The ACA can be contacted via email at or on the website.

Finally, there are many self-funded plans that initiate audits and recoupment requests.  In these cases, the plans are governed by federal ERISA regulations.  The ACA strongly encourages providers who find themselves in this situation to file an ERISA appeal as these recoupment requests are often considered retroactive denials of coverage.  The ACA has an ERISA appeals assistance page for members that can be found at: All providers are encouraged to use the comprehensive Patient Authorization Form.


The information contained in this document is designed to provide accurate and authoritative information on the subject matter covered. This information is not intended for and should not be used as a substitute for specific legal, tax, coding or other clinical or professional advice. This information is provided with the understanding that the ACA is not engaged in rendering legal, coding, clinical, accounting or other professional service in specific situations. Although prepared by professionals, this information should not be utilized as a substitute for professional advice in specific situations. If legal or other counsel is required, the services of a professional should be sought. The ACA may not be held liable for any misuse or misinterpretation of the information in this publication. All information provided is believed and intended to be reliable, but accuracy cannot be guaranteed by the ACA.