Optimizing billing, coding, and A/R management workflows is crucial to the success of any healthcare revenue cycle. However, tying together each function is one vital component that can make or break your bottom line: compliance. Despite best efforts, many billing teams struggle to appropriately code and bill for complex charges while balancing the countless other day-to-day functions in a medical billing office, leading to non-compliance penalties, administrative inefficiencies, and rising healthcare costs. 

Fraudulent billing, including every act of non-compliance from small errors to major discrepancies, comprises 3% to 10% of all healthcare spending.¹ The costs of non-compliance extend beyond a simple fine — recurring violations can delay reimbursements and impact patient satisfaction, which, in turn, will eventually narrow practice operating margins.

Understanding Healthcare Billing Regulations

Medical billing regulations are multifaceted, encompassing federal and state laws, as well as industry standards that apply to all healthcare businesses. HIPAA compliance in billing is just the tip of the iceberg — practices must navigate the intricacies of specialized billing codes, documentation requirements, and variable reimbursement guidelines set by different commercial and government payers. Outside of individual health plan policies and state laws, healthcare practices must adhere to the standards of multiple federal laws, including:

1. False Claims Act (FCA). The FCA imposes liability on individuals or entities submitting fraudulent claims to the government, including false statements or omissions, in the form of three times the government’s damages in addition to a financial penalty adjusted to inflation.²

2. Anti-Kickback Statute (AKS). The AKS prohibits offering, paying, soliciting, or receiving money in exchange for patient referrals or business involving federal healthcare programs, aiming to prevent financial incentives that may influence medical decision-making.³

3. No Surprises Act (NSA). The NSA protects patients from unexpected medical bills by establishing rules for billing and reimbursement in situations such as out-of-network emergency care, ensuring that patients are not financially burdened by surprise charges for healthcare services.⁴ 

Hidden Threats to Compliance

Even if your billing team is in the clear of major acts of non-compliance, there is still a significant risk of regulatory violations due to factors that are often out of your control. Refusing to accept financial incentives or submit false claims does not necessarily mean your practice is in full compliance. Maintaining healthcare billing compliance is a continual challenge for practices due to:

• Coding and billing errors. Even the smallest inaccuracies can spiral out of control as claims move through the revenue cycle. Upcoding, undercoding, duplicate billing, and unbundling are common sources of non-compliance and billing violations within medical practices — even when done unknowingly.

• Wasteful healthcare utilization. The need to prove medical necessity doesn’t just apply to reimbursements. Excessive diagnostic testing, unnecessary procedures, and non-compliance with healthcare utilization guidelines can result in significant penalties that, combined with lower reimbursement, can threaten practice financial health.

• Shifting privacy regulations and enforcement rules. Achieving compliance is not a one-time event. To adapt to new challenges and compliance risks, healthcare regulatory bodies continually update their compliance requirements and privacy regulations. If your billing office isn’t keeping up with these changes, you may be at risk for non-compliance.

• Cyberattacks. The healthcare sector is a prime target for cyberattacks seeking valuable patient data. 2023 was a record-breaking year for healthcare data breaches, with 725 breaches of more than 500 patient records — more than double the number of cyberattacks in 2017.⁵ With the rise of cyberattacks, practices must act now to protect patient information and uphold billing system integrity.

A Simple Solution To Ensure Compliance and Drive Revenue — At the Same Time

Maintaining billing compliance may seem like navigating a minefield of threats to practice reputation and revenue, but expert partners like Med USA can help eliminate risks and streamline the processes necessary to achieve complete regulatory compliance. Our commitment to compliance is embedded in our proprietary Excellence In Action program, which serves as the backbone of all revenue cycle management, credentialing, and business intelligence solutions for healthcare businesses. As a compliance-first billing partner, Med USA provides comprehensive compliance training for healthcare providers and aligns billing workflows to industry-standard medical billing audit protocols, helping practices mitigate every possible compliance risk and safeguard against potential penalties, litigation, and financial losses. 

To learn more about healthcare fraud prevention and best practices in medical billing compliance, watch the on-demand webinar from a healthcare compliance specialist.

Ready to Learn More About How Med USA Can Help Ensure Billing Compliance in Your Practice?

Contact our team today!

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Sources

1. Drabiak, K., & Wolfson, J. (2020). What Should Health Care Organizations Do to Reduce Billing Fraud and Abuse? AMA journal of ethics, 22(3), E221–E231.
2. The False Claims Act. (2023, April 4). U.S. Department of Justice. https://www.justice.gov/civil/false-claims-act 
3. Fraud & Abuse Laws. (n.d.). U.S. Department of Health and Human Services: Office of Inspector General. Retrieved from https://oig.hhs.gov/compliance/physician-education/fraud-abuse-laws/ 
4. Implementation of the No Surprises Act. (n.d.). American Medical Association. https://www.ama-assn.org/delivering-care/patient-support-advocacy/implementation-no-surprises-act 
5. Adler, S. (2024, January 18). December 2023 Healthcare Data Breach Report. The HIPAA Journal. https://www.hipaajournal.com/december-2023-healthcare-data-breach-report/