Find-A-Code Focus Newsletter

Conducting a Gap Analysis for Your Documentation & Billing Systems

November 21, 2014



What is a Gap Analysis?

A Gap Analysis is a process by which a practice conducts a baseline assessment of the company's coding, billing, operations, and business practices. The objective of a Gap Analysis is to ensure that the practice is in full compliance with applicable legal and ethical requirements. 

This performance measurement tool is used to determine which actions must be taken in order to bring the entity's practices up to the desired/required level of compliance. 

A Gap Analysis is also a tool used for the protection and prevention of unrecognized and uncorrected errors and oversights that are sure to eventually become quite costly to a practice in terms of refunds, fees, fines, legal expenses, local and federal agency penalties and others. By a practice performing their own Gap Analysis on a regular basis, a level of quality control and maintenance is able to be achieved so as to prevent unnecessary, unintentional and potentially costly errors.

It is recommended that every practice perform a Gap Analysis at a minimum of once per year. However, when performing an initial Gap Analysis, in the event there are multiple issues to be addressed and corrected, once a plan is devised and implemented in order to make these improvements, the practice would be well served to perform a follow-up Gap Analysis 3-6 months later to more closely monitor improvements. This process should be followed until the practice is at a comfortable state to where only an annual Gap Analysis may be deemed necessary. At the same time, there are many practices that prefer to conduct Gap Analysis quarterly or semi-annually as an added means of quality control. This determination would be up to the owner and/or management of each practice. So again, at a minimum, a Gap Analysis should be conducted at least once per year. 

Steps to conduct a Gap Analysis:

Step 1. Identify applicable legal and ethical standards to be achieved and maintained. This includes:
-Coding requirements for services billed in your practice
-Proper billing practices and fees for claims
-Identify optimum documentation practices
-Review laws, regulations and ethical standards related to compliant business practices within your area

With this information, you will need to assemble a complete list of Policies and Procedures that need to be implemented or improved in these categories

Step 2. Conduct an audit of the entities coding activities, billing practices and business operations
-Do the provider's activities comply with applicable local, state and federal requirements?
-Do the provider's coding and billing practices comply with applicable coding rules and regulations?
-Are services and claims properly documented?
-Are business practices (joint ventures, contracts, etc) compliant with requirements?
-Are business relationships compliant with requirements (such as Stark and the federal Anti-Kickback statute)?

Step 3: Where do the coding, billing, operations and business practices fall short?
-Identify these deficiencies and risk areas to identify the "Gap" 
-Outline steps and procedures that need to be implemented in order to bridge this Gap

Maintain notes and records for this process. Schedule a follow-up Gap Analysis at a time that will help assure that all implementations have been addressed and continued oversights are not continued. A Gap Analysis is often a team effort although there may be occasions where one or two employees are conducting the majority of the analysis. The progress and findings of the Gap Analysis should be addressed at scheduled staff meetings so as to engage and inform the entire team.


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