Medical Billing Audit Checklist for Clinic Owners

Most clinic owners know their billing isn't performing at its best. Most don't know where the problem is. This 22-point checklist gives you a structured way to audit your billing operation — whether you do it in-house or outsource it — and identify exactly where revenue is leaking.

Section 1: Clean Claim Rate (Points 1–5)

• ✓What percentage of your claims are paid on the first submission? Below 90% indicates systematic problems in claim preparation.
• ✓What are your top 5 denial reason codes by frequency? If you don't know these, your billing operation doesn't have a tracking system.
• ✓What percentage of denied claims are appealed vs written off? Write-off rates above 5% of billed charges indicate inadequate follow-up.
• ✓Are claims being submitted within 24 hours of service delivery? Any delay beyond 48 hours extends your collection cycle unnecessarily.
• ✓Do you have payer-specific claim scrubbing rules, or are you using only the clearinghouse default edits?

Section 2: AR Management (Points 6–10)

• ✓What is your current DSO? If you cannot calculate it immediately from your billing system, you don't have adequate AR visibility.
• ✓What percentage of your AR is over 90 days? Over 20% indicates a systemic follow-up problem.
• ✓What is your outstanding AR over 180 days? This bucket has the lowest recovery rate — anything over 5% of total AR is a serious issue.
• ✓Is every claim in the 30–60 day bucket being actively followed up, or only the high-dollar claims?
• ✓When a claim is denied, is the follow-up documented in your billing system with a specific next action and date?

Section 3: Coding and Compliance (Points 11–16)

• ✓When did you last compare your fee schedule to current Medicare rates? Fee schedules that haven't been updated in 2+ years often leave money on the table.
• ✓Do you have a current list of NPI, taxonomy, and provider enrollment status for every payer you bill? Outdated enrollment causes denials that look like claim errors.
• ✓Are your ICD-10 and CPT/HCPCS codes updated for the current fiscal year? CMS updates codes annually — outdated codes cause systematic rejections.
• ✓Is your billing team tracking modifier rules per payer, or applying generic modifiers across all payers?
• ✓Have you had a formal compliance review in the last 24 months? Billing patterns that deviate from clinical documentation are a compliance risk.
• ✓Do your billing codes match what is documented in the clinical record for every encounter?

Section 4: Operations and Reporting (Points 17–22)

• ✓Do you receive a monthly report showing denial rate, DSO, collection rate, and AR aging? If your billing company cannot provide this, that is itself an audit finding.
• ✓Can you identify your revenue per visit or per encounter by payer? Wide variation by payer indicates contracting or coding gaps.
• ✓Do you have a written process for handling duplicate claims vs corrected claims? Using the wrong claim type creates additional denials.
• ✓What is your authorization denial rate? Authorizations that were obtained but expired before service delivery are preventable.
• ✓How long does it take from service delivery to payment posting in your system? The end-to-end cycle time reveals where delays are concentrated.
• ✓What percentage of your billed charges are collected? Below 80% indicates either a billing problem or a contracting problem — both need attention.