Today’s hospitals have to do a lot more with a lot less. Obviously, organizations would rather focus on patient care and not red tape. But the reality is that hospitals must spend more and more time lately on back-end administrative processes – including compliance, audit management, and denials – in order to direct more dollars to the front end.

Many hospitals have already started centralization with central business offices (CBOs), so centralizing the RAC/audit management function is a logical next step.

Why centralize?

When I started centralization of audit management at a large, nonprofit, Midwest health system, I needed to determine existing challenges in audit management and revenue cycle. There were four key challenges. Centralization was the answer.

  • Staff members were having difficulties finding, tracking, and working appeals.
  • Letters and requests were going to numerous places, wasting time and causing duplicated efforts.
  • Up to 25 percent of some staff members’ time was spent on audits; however, it wasn’t a priority for anyone.
  • Each health information management (HIM) department and case management department was handling the audits differently.

Through centralizing, we made audit management one team’s priority. That team became an internal department of experts that could more rapidly comprehend and adjust to all of the various audit requirements and auditor nuances.

Steps to centralization

First, decide who will be accountable for ensuring a prompt response to audits. Next, ensure that all data surrounding the audit is captured and tracked in a timely fashion. Finally, let the numbers speak for themselves in establishing the audit team’s staffing and budgetary needs.

One word of caution, however: one accountable team does not mean that other departments impacted by audits should not be engaged.

It’s also important to know who the requestors are, how many requests they are sending, and where those requests are being sent. It’s also imperative to determine what information is being tracked, by whom, and for how long.

Other questions to answer include:

  1. How much data entry is involved?
  2. What is the cycle time to process and deliver a record to the requestor? How much time is being spent on writing appeals?
  3. How many people are involved in writing an appeal?
  4. Are the appeal writers put together in-house or externally?
  5. What do your stakeholders want to know?
  6. What do your stakeholders need to know?

Also, avoid being email-dependent. Don’t let email communication be your sole audit management tool. It’s way too easy to accidentally delete a record, and that could cost you serious money.

The argument for centralization

When decentralized staffers act only as casual audit managers:

  • It’s unlikely they will become experts;
  • Their processes will remain inconsistent;
  • It will take longer to interpret each request and determine where it came from; and
  • It will take longer to understand auditor communications and results or reviews.

A centralized team, on the other hand, can become a source full of expertise and pull in specific subject-matter experts (SMEs) as needed. The more team members process audits and learn, the faster they will become. 

The key is to make the process leaner by reducing the numbers of touches and handoffs, then have staff work more efficiently while managing audits. This eliminates waste throughout the entire audit management process (via data entry errors, over-processing, duplication of work efforts, etc.).  

In other words, making a process leaner is all about eliminating waste. The more people involved, the greater the possibility of error. Error equals waste.


When you bring it all together and centralize your RAC and audit processes, data will be more consistent, less variable, and more useful for root cause and risk analysis. Better business intelligence means a better chance to be able to improve both audit and clinical documentation outcomes for the future.

About the Author

Dawn Crump, MA, SSBB, CHC, is the vice president of audit management solutions for HealthPort. Dawn has been in the healthcare compliance industry for more than 18 years, having joined HealthPort in 2013 as vice president of audit management solutions. Prior to joining HealthPort, she was network director of audit and compliance for a Midwest health system. She has healthcare experience in revenue cycle, education, organization development, quality improvement, and corporate compliance.

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